Contrasting ANNALY CAP MGMT/SH (NYSE:NLY) & Essential Properties Realty Trust (NYSE:EPRT)

ANNALY CAP MGMT/SH (NYSE:NLY) and Essential Properties Realty Trust (NYSE:EPRT) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, earnings, valuation, institutional ownership, dividends, analyst recommendations and profitability.

Analyst Recommendations

This is a breakdown of current ratings for ANNALY CAP MGMT/SH and Essential Properties Realty Trust, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ANNALY CAP MGMT/SH 0 0 5 0 3.00
Essential Properties Realty Trust 0 4 6 0 2.60

ANNALY CAP MGMT/SH currently has a consensus target price of $10.40, suggesting a potential upside of 11.59%. Essential Properties Realty Trust has a consensus target price of $20.13, suggesting a potential downside of 6.70%. Given ANNALY CAP MGMT/SH’s stronger consensus rating and higher possible upside, research analysts plainly believe ANNALY CAP MGMT/SH is more favorable than Essential Properties Realty Trust.

Dividends

ANNALY CAP MGMT/SH pays an annual dividend of $1.20 per share and has a dividend yield of 12.9%. Essential Properties Realty Trust pays an annual dividend of $0.88 per share and has a dividend yield of 4.1%. ANNALY CAP MGMT/SH pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation & Earnings

This table compares ANNALY CAP MGMT/SH and Essential Properties Realty Trust’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ANNALY CAP MGMT/SH $1.43 billion 9.46 $54.40 million $1.20 7.77
Essential Properties Realty Trust $96.22 million 16.83 $15.61 million N/A N/A

ANNALY CAP MGMT/SH has higher revenue and earnings than Essential Properties Realty Trust.

Institutional and Insider Ownership

56.9% of ANNALY CAP MGMT/SH shares are owned by institutional investors. Comparatively, 76.1% of Essential Properties Realty Trust shares are owned by institutional investors. 0.3% of ANNALY CAP MGMT/SH shares are owned by insiders. Comparatively, 2.1% of Essential Properties Realty Trust shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares ANNALY CAP MGMT/SH and Essential Properties Realty Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ANNALY CAP MGMT/SH -155.89% 12.04% 1.38%
Essential Properties Realty Trust 21.30% 2.83% 1.75%

Volatility and Risk

ANNALY CAP MGMT/SH has a beta of 0.39, suggesting that its stock price is 61% less volatile than the S&P 500. Comparatively, Essential Properties Realty Trust has a beta of 0.49, suggesting that its stock price is 51% less volatile than the S&P 500.

Summary

Essential Properties Realty Trust beats ANNALY CAP MGMT/SH on 9 of the 15 factors compared between the two stocks.

ANNALY CAP MGMT/SH Company Profile

Annaly Capital Management, Inc., a diversified capital manager, invests in and finances residential and commercial assets. The company invests in various types of agency mortgage-backed securities, non-agency residential mortgage assets, and residential mortgage loans; and originates and invests in commercial mortgage loans, securities, and other commercial real estate investments. It also provides financing to private equity-backed middle market businesses; and operates as a broker-dealer. The company has elected to be taxed as a real estate investment trust (REIT). As a REIT, it is not subject to federal income tax to the extent that it distributes its taxable income to its shareholders. Annaly Capital Management, Inc. was founded in 1996 and is based in New York, New York.

Essential Properties Realty Trust Company Profile

Essential Properties Realty Trust, Inc., a real estate company, acquires, owns, and manages single-tenant properties in the United States. The company leases its properties to middle-market companies, such as restaurants, car washes, automotive services, medical services, convenience stores, entertainment, early childhood education, and health and fitness on a long-term basis. As of December 31, 2018, it had a portfolio of 677 properties. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was founded in 2016 and is based in Princeton, New Jersey.

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