Ventas (NYSE:VTR) and Alexandria Real Estate Equities (NYSE:ARE) Critical Analysis

Ventas (NYSE:VTR) and Alexandria Real Estate Equities (NYSE:ARE) are both real estate companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, dividends, profitability, analyst recommendations, valuation, risk and institutional ownership.

Valuation and Earnings

This table compares Ventas and Alexandria Real Estate Equities”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ventas	$5.83 billion	7.62	$251.38 million	$0.54	160.44
Alexandria Real Estate Equities	$3.03 billion	2.88	-$1.43 billion	($6.06)	-8.24

Ventas has higher revenue and earnings than Alexandria Real Estate Equities. Alexandria Real Estate Equities is trading at a lower price-to-earnings ratio than Ventas, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Ventas and Alexandria Real Estate Equities, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ventas	0	3	14	0	2.82
Alexandria Real Estate Equities	4	10	2	0	1.88

Ventas currently has a consensus price target of $99.39, indicating a potential upside of 14.72%. Alexandria Real Estate Equities has a consensus price target of $53.38, indicating a potential upside of 6.87%. Given Ventas’ stronger consensus rating and higher possible upside, analysts clearly believe Ventas is more favorable than Alexandria Real Estate Equities.

Risk and Volatility

Ventas has a beta of 0.7, suggesting that its share price is 30% less volatile than the S&P 500. Comparatively, Alexandria Real Estate Equities has a beta of 1.15, suggesting that its share price is 15% more volatile than the S&P 500.

Profitability

This table compares Ventas and Alexandria Real Estate Equities’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ventas	4.08%	1.99%	0.94%
Alexandria Real Estate Equities	-36.08%	-5.21%	-2.92%

Insider & Institutional Ownership

94.2% of Ventas shares are owned by institutional investors. Comparatively, 96.5% of Alexandria Real Estate Equities shares are owned by institutional investors. 0.5% of Ventas shares are owned by insiders. Comparatively, 1.4% of Alexandria Real Estate Equities shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

Ventas pays an annual dividend of $2.08 per share and has a dividend yield of 2.4%. Alexandria Real Estate Equities pays an annual dividend of $2.88 per share and has a dividend yield of 5.8%. Ventas pays out 385.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Alexandria Real Estate Equities pays out -47.5% of its earnings in the form of a dividend. Ventas has increased its dividend for 1 consecutive years and Alexandria Real Estate Equities has increased its dividend for 15 consecutive years. Alexandria Real Estate Equities is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Ventas beats Alexandria Real Estate Equities on 11 of the 17 factors compared between the two stocks.

About Ventas

Ventas Inc. (NYSE: VTR) is a leading S&P 500 real estate investment trust focused on delivering strong, sustainable shareholder returns by enabling exceptional environments that benefit a large and growing aging population. The Company's growth is fueled by its senior housing communities, which provide valuable services to residents and enable them to thrive in supported environments. Ventas leverages its unmatched operational expertise, data-driven insights from its Ventas Operational InsightsTM platform, extensive relationships and strong financial position to achieve its goal of delivering outsized performance across approximately 1,400 properties. The Ventas portfolio is composed of senior housing communities, outpatient medical buildings, research centers and healthcare facilities in North America and the United Kingdom. The Company benefits from a seasoned team of talented professionals who share a commitment to excellence, integrity and a common purpose of helping people live longer, healthier, happier lives.

About Alexandria Real Estate Equities

Alexandria Real Estate Equities, Inc. (NYSE: ARE), an S&P 500 company, is a best-in-class, mission-driven life science REIT making a positive and lasting impact on the world. As the pioneer of the life science real estate niche since our founding in 1994, Alexandria is the preeminent and longest-tenured owner, operator, and developer of collaborative life science, agtech, and advanced technology mega campuses in AAA innovation cluster locations, including Greater Boston, the San Francisco Bay Area, New York City, San Diego, Seattle, Maryland, and Research Triangle. Alexandria has a total market capitalization of $33.1 billion and an asset base in North America of 73.5 million SF as of December 31, 2023, which includes 42.0 million RSF of operating properties, 5.5 million RSF of Class A/A+ properties undergoing construction and one near-term project expected to commence construction in the next two years, 2.1 million RSF of priority anticipated development and redevelopment projects, and 23.9 million SF of future development projects. Alexandria has a longstanding and proven track record of developing Class A/A+ properties clustered in life science, agtech, and advanced technology mega campuses that provide our innovative tenants with highly dynamic and collaborative environments that enhance their ability to successfully recruit and retain world-class talent and inspire productivity, efficiency, creativity, and success. Alexandria also provides strategic capital to transformative life science, agrifoodtech, climate innovation, and technology companies through our venture capital platform. We believe our unique business model and diligent underwriting ensure a high-quality and diverse tenant base that results in higher occupancy levels, longer lease terms, higher rental income, higher returns, and greater long-term asset value.