Safehold (NYSE:SAFE) versus Gladstone Land (NASDAQ:LAND) Head-To-Head Analysis

Safehold (NYSE:SAFE) and Gladstone Land (NASDAQ:LAND) are both small-cap real estate companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, institutional ownership, earnings and risk.

Dividends

Safehold pays an annual dividend of $0.71 per share and has a dividend yield of 6.0%. Gladstone Land pays an annual dividend of $0.56 per share and has a dividend yield of 5.9%. Safehold pays out 43.8% of its earnings in the form of a dividend. Gladstone Land pays out -101.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Safehold has raised its dividend for 1 consecutive years and Gladstone Land has raised its dividend for 2 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Safehold and Gladstone Land, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Safehold	2	7	2	0	2.00
Gladstone Land	1	2	0	1	2.25

Safehold currently has a consensus target price of $15.67, indicating a potential upside of 32.94%. Gladstone Land has a consensus target price of $10.00, indicating a potential upside of 5.71%. Given Safehold’s higher probable upside, analysts clearly believe Safehold is more favorable than Gladstone Land.

Profitability

This table compares Safehold and Gladstone Land’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Safehold	27.70%	4.76%	1.62%
Gladstone Land	-7.31%	-0.96%	-0.53%

Valuation & Earnings

This table compares Safehold and Gladstone Land”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	2.16	$114.47 million	$1.62	7.27
Gladstone Land	$88.48 million	4.61	$13.53 million	($0.55)	-17.20

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

Insider & Institutional Ownership

70.4% of Safehold shares are owned by institutional investors. Comparatively, 53.6% of Gladstone Land shares are owned by institutional investors. 3.8% of Safehold shares are owned by company insiders. Comparatively, 6.1% of Gladstone Land 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.

Volatility & Risk

Safehold has a beta of 1.73, indicating that its share price is 73% more volatile than the S&P 500. Comparatively, Gladstone Land has a beta of 1.09, indicating that its share price is 9% more volatile than the S&P 500.

Summary

Safehold beats Gladstone Land 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 Gladstone Land

Founded in 1997, Gladstone Land is a publicly traded real estate investment trust that acquires and owns farmland and farm-related properties located in major agricultural markets in the U.S. and leases its properties to unrelated third-party farmers. The Company, which reports the aggregate fair value of its farmland holdings on a quarterly basis, currently owns 169 farms, comprised of approximately 116,000 acres in 15 different states and over 45,000 acre-feet of banked water in California, valued at a total of approximately $1.6 billion. Gladstone Land’s farms are predominantly located in regions where its tenants are able to grow fresh produce annual row crops, such as berries and vegetables, which are generally planted and harvested annually. The Company also owns farms growing permanent crops, such as almonds, apples, cherries, figs, lemons, olives, pistachios, and other orchards, as well as blueberry groves and vineyards, which are generally planted every 20-plus years and harvested annually. Approximately 40% of the Company’s fresh produce acreage is either organic or in transition to become organic, and over 10% of its permanent crop acreage falls into this category. The Company may also acquire property related to farming, such as cooling facilities, processing buildings, packaging facilities, and distribution centers. Gladstone Land pays monthly distributions to its stockholders and has paid 129 consecutive monthly cash distributions on its common stock since its initial public offering in January 2013. The Company has increased its common distributions 32 times over the prior 35 quarters, and the current per-share distribution on its common stock is $0.0464 per month, or $0.5568 per year.