Comparing DCT Industrial Trust (DCT) & Prologis (PLD)

DCT Industrial Trust (NYSE: DCT) and Prologis (NYSE:PLD) are both mid-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, valuation, earnings and risk.

Valuation & Earnings

This table compares DCT Industrial Trust and Prologis’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
DCT Industrial Trust $418.17 million 13.31 $286.65 million $0.99 60.42
Prologis $2.94 billion 11.78 $1.96 billion $2.22 29.34

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

Institutional and Insider Ownership

95.4% of DCT Industrial Trust shares are held by institutional investors. Comparatively, 96.0% of Prologis shares are held by institutional investors. 1.5% of DCT Industrial Trust shares are held by company insiders. Comparatively, 1.3% of Prologis shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Risk & Volatility

DCT Industrial Trust has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500. Comparatively, Prologis has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500.

Dividends

DCT Industrial Trust pays an annual dividend of $1.24 per share and has a dividend yield of 2.1%. Prologis pays an annual dividend of $1.76 per share and has a dividend yield of 2.7%. DCT Industrial Trust pays out 125.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Prologis pays out 79.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. DCT Industrial Trust has increased its dividend for 3 consecutive years and Prologis has increased its dividend for 2 consecutive years. Prologis is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a breakdown of current recommendations for DCT Industrial Trust and Prologis, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DCT Industrial Trust 0 5 2 0 2.29
Prologis 0 3 12 0 2.80

DCT Industrial Trust presently has a consensus target price of $53.00, indicating a potential downside of 11.40%. Prologis has a consensus target price of $60.00, indicating a potential downside of 7.88%. Given Prologis’ stronger consensus rating and higher probable upside, analysts plainly believe Prologis is more favorable than DCT Industrial Trust.

Profitability

This table compares DCT Industrial Trust and Prologis’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DCT Industrial Trust 22.20% 4.69% 2.43%
Prologis 43.99% 6.65% 3.95%

Summary

Prologis beats DCT Industrial Trust on 12 of the 17 factors compared between the two stocks.

DCT Industrial Trust Company Profile

DCT Industrial Trust Inc. (DCT) is an industrial real estate company. The Company specializes in the ownership, acquisition, development, leasing and management of bulk-distribution and light-industrial properties located in various distribution markets in the United States. The Company operates through three segments: East, Central and West. As of December 31, 2016, the Company owned interests in approximately 74.0 million square feet of properties leased to various customers, including 64.7 million square feet consisting of 401 consolidated operating properties that were 97.2% occupied; 7.8 million square feet consisting of 23 unconsolidated properties that were 97.8% occupied; 0.3 million square feet consisting of three consolidated properties under redevelopment, and 1.2 million square feet consisting of four consolidated properties. As of December 31, 2016, the Company’s total consolidated portfolio consisted of 408 properties with an average size of 162,000 square feet.

Prologis Company Profile

Prologis, Inc. is a real estate investment trust (REIT) company. The Company is engaged in logistics real estate business. The Company’s segments include Real Estate Operations and Strategic Capital. The Real estate operations segment consists of rental operations and development. The Company’s strategic capital segment includes asset management services, as well as services performed for unconsolidated co-investment ventures. Its strategic capital segment gives the Company access to third-party capital, both private and public. As of December 31, 2016, the Company owned or had investments in, on an owned basis or through co-investment ventures, properties and development projects across 676 million square feet (63 million square meters) in 20 countries spanning four continents.

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