Head-To-Head Review: Empire State Realty Trust (NYSE:ESRT) versus Easterly Government Properties (NYSE:DEA)

Empire State Realty Trust (NYSE:ESRT) and Easterly Government Properties (NYSE:DEA) are both small-cap real estate companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, risk, institutional ownership, profitability and earnings.

Dividends

Empire State Realty Trust pays an annual dividend of $0.14 per share and has a dividend yield of 3.4%. Easterly Government Properties pays an annual dividend of $1.80 per share and has a dividend yield of 7.9%. Empire State Realty Trust pays out 200.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Easterly Government Properties pays out 857.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Institutional and Insider Ownership

67.1% of Empire State Realty Trust shares are owned by institutional investors. Comparatively, 86.5% of Easterly Government Properties shares are owned by institutional investors. 15.2% of Empire State Realty Trust shares are owned by company insiders. Comparatively, 6.5% of Easterly Government Properties shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Empire State Realty Trust and Easterly Government Properties, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Empire State Realty Trust	2	1	0	0	1.33
Easterly Government Properties	1	4	2	0	2.14

Empire State Realty Trust presently has a consensus target price of $5.00, suggesting a potential upside of 23.00%. Easterly Government Properties has a consensus target price of $25.06, suggesting a potential upside of 10.09%. Given Empire State Realty Trust’s higher possible upside, analysts plainly believe Empire State Realty Trust is more favorable than Easterly Government Properties.

Profitability

This table compares Empire State Realty Trust and Easterly Government Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Empire State Realty Trust	0.93%	0.40%	0.17%
Easterly Government Properties	2.86%	0.75%	0.30%

Earnings & Valuation

This table compares Empire State Realty Trust and Easterly Government Properties”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Empire State Realty Trust	$768.27 million	0.92	$47.60 million	$0.07	58.07
Easterly Government Properties	$336.10 million	3.21	$13.00 million	$0.21	108.41

Empire State Realty Trust has higher revenue and earnings than Easterly Government Properties. Empire State Realty Trust is trading at a lower price-to-earnings ratio than Easterly Government Properties, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Empire State Realty Trust has a beta of 1.36, indicating that its stock price is 36% more volatile than the S&P 500. Comparatively, Easterly Government Properties has a beta of 0.98, indicating that its stock price is 2% less volatile than the S&P 500.

Summary

Easterly Government Properties beats Empire State Realty Trust on 10 of the 16 factors compared between the two stocks.

About Empire State Realty Trust

Empire State Realty Trust, Inc. (NYSE: ESRT) is a NYC-focused REIT that owns and operates a portfolio of modernized, amenitized, and well-located office, retail, and multifamily assets. The company is the recognized leader in energy efficiency and indoor environmental quality. ESRT’s flagship Empire State Building – the “World’s Most Famous Building” – includes its Observatory, Tripadvisor’s 2023 Travelers’ Choice Awards: Best of the Best the #1 attraction in the US for two consecutive years. As of September 30, 2023, ESRT’s portfolio is comprised of approximately 8.6 million rentable square feet of office space, 0.7 million rentable square feet of retail space and 727 residential units across three multifamily properties.

About Easterly Government Properties

Easterly Government Properties, Inc. (NYSE: DEA) is based in Washington, D.C., and focuses primarily on the acquisition, development and management of Class A commercial properties that are leased to the U.S. Government. Easterly’s experienced management team brings specialized insight into the strategy and needs of mission-critical U.S. Government agencies for properties leased to such agencies either directly or through the U.S. General Services Administration (GSA).