Critical Comparison: Safehold (NYSE:SAFE) versus Millrose Properties (NYSE:MRP)

Safehold (NYSE:SAFE) and Millrose Properties (NYSE:MRP) are both real estate companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, dividends, valuation and risk.

Profitability

This table compares Safehold and Millrose Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Safehold	27.70%	4.76%	1.62%
Millrose Properties	62.60%	8.13%	5.07%

Risk & Volatility

Safehold has a beta of 1.78, indicating that its share price is 78% more volatile than the S&P 500. Comparatively, Millrose Properties has a beta of 0.53, indicating that its share price is 47% less volatile than the S&P 500.

Institutional and Insider Ownership

70.4% of Safehold shares are owned by institutional investors. 3.8% of Safehold shares are owned by company insiders. Comparatively, 0.2% of Millrose Properties shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Safehold pays an annual dividend of $0.71 per share and has a dividend yield of 5.9%. Millrose Properties pays an annual dividend of $3.08 per share and has a dividend yield of 12.5%. Safehold pays out 43.8% of its earnings in the form of a dividend. Millrose Properties pays out 107.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Safehold has raised its dividend for 1 consecutive years.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Safehold and Millrose Properties, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Safehold	2	7	2	0	2.00
Millrose Properties	0	2	1	1	2.75

Safehold currently has a consensus target price of $15.67, suggesting a potential upside of 29.44%. Millrose Properties has a consensus target price of $37.67, suggesting a potential upside of 53.11%. Given Millrose Properties’ stronger consensus rating and higher possible upside, analysts clearly believe Millrose Properties is more favorable than Safehold.

Earnings and Valuation

This table compares Safehold and Millrose Properties”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Safehold	$385.55 million	2.22	$114.47 million	$1.62	7.47
Millrose Properties	$600.46 million	6.32	$379.86 million	$2.87	8.57

Millrose Properties has higher revenue and earnings than Safehold. Safehold is trading at a lower price-to-earnings ratio than Millrose Properties, indicating that it is currently the more affordable of the two stocks.

Summary

Millrose Properties beats Safehold on 12 of the 18 factors compared between the two stocks.

About Safehold

Safehold Inc. (NYSE: SAFE) is revolutionizing real estate ownership by providing a new and better way for owners to unlock the value of the land beneath their buildings. Having created the modern ground lease industry in 2017, Safehold continues to help owners of high quality multifamily, office, industrial, hospitality, student housing, life science and mixed-use properties generate higher returns with less risk. The Company, which is taxed as a real estate investment trust (REIT), seeks to deliver safe, growing income and long-term capital appreciation to its shareholders.

About Millrose Properties

Millrose Properties, Inc. is a real estate investment and management company that focuses on acquiring, developing, and managing high-quality commercial properties. They are headquartered in Purchase, New York.