Reviewing Gladstone Commercial (NASDAQ:GOOD) and First Industrial Realty Trust (NYSE:FR)

First Industrial Realty Trust (NYSE:FR) and Gladstone Commercial (NASDAQ:GOOD) are both real estate companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, earnings, analyst recommendations, institutional ownership, profitability, valuation and dividends.

Analyst Ratings

This is a summary of current ratings and target prices for First Industrial Realty Trust and Gladstone Commercial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Industrial Realty Trust	0	7	7	1	2.60
Gladstone Commercial	0	4	0	0	2.00

First Industrial Realty Trust presently has a consensus target price of $67.43, suggesting a potential upside of 10.23%. Gladstone Commercial has a consensus target price of $12.83, suggesting a potential upside of 2.91%. Given First Industrial Realty Trust’s stronger consensus rating and higher probable upside, equities research analysts plainly believe First Industrial Realty Trust is more favorable than Gladstone Commercial.

Profitability

This table compares First Industrial Realty Trust and Gladstone Commercial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Industrial Realty Trust	47.97%	12.99%	6.41%
Gladstone Commercial	14.55%	14.61%	1.99%

Dividends

First Industrial Realty Trust pays an annual dividend of $2.00 per share and has a dividend yield of 3.3%. Gladstone Commercial pays an annual dividend of $1.20 per share and has a dividend yield of 9.6%. First Industrial Realty Trust pays out 73.0% of its earnings in the form of a dividend. Gladstone Commercial pays out 461.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. First Industrial Realty Trust has raised its dividend for 12 consecutive years.

Valuation and Earnings

This table compares First Industrial Realty Trust and Gladstone Commercial”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Industrial Realty Trust	$727.08 million	11.15	$247.44 million	$2.74	22.33
Gladstone Commercial	$161.34 million	3.74	$19.29 million	$0.26	47.96

First Industrial Realty Trust has higher revenue and earnings than Gladstone Commercial. First Industrial Realty Trust is trading at a lower price-to-earnings ratio than Gladstone Commercial, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

99.8% of First Industrial Realty Trust shares are held by institutional investors. Comparatively, 45.5% of Gladstone Commercial shares are held by institutional investors. 1.1% of First Industrial Realty Trust shares are held by company insiders. Comparatively, 1.3% of Gladstone Commercial shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Risk & Volatility

First Industrial Realty Trust has a beta of 1.03, suggesting that its share price is 3% more volatile than the S&P 500. Comparatively, Gladstone Commercial has a beta of 1.08, suggesting that its share price is 8% more volatile than the S&P 500.

Summary

First Industrial Realty Trust beats Gladstone Commercial on 13 of the 18 factors compared between the two stocks.

About First Industrial Realty Trust

First Industrial Realty Trust, Inc. (NYSE: FR) is a leading U.S.-only owner, operator, developer and acquirer of logistics properties. Through our fully integrated operating and investing platform, we provide high quality facilities and industry-leading customer service to multinational corporations and regional firms that are essential for their supply chains. Our portfolio and new investments are concentrated in 15 target MSAs with an emphasis on supply-constrained, coastally oriented markets. In total, we own and have under development approximately 68.5 million square feet of industrial space as of December 31, 2023.

About Gladstone Commercial

Gladstone Commercial Corporation is a real estate investment trust focused on acquiring, owning, and operating net leased industrial and office properties across the United States. Including payments through January 2024, Gladstone Commercial has paid 229 consecutive monthly cash distributions on its common stock. Prior to paying distributions on a monthly basis, Gladstone Commercial paid five consecutive quarterly cash distributions. Gladstone Commercial has never skipped or deferred a distribution since its inception in 2003.