SL Green Realty (NYSE:SLG) and The GEO Group (NYSE:GEO) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, earnings, analyst recommendations, profitability, risk and dividends.
SL Green Realty pays an annual dividend of $3.54 per share and has a dividend yield of 7.1%. The GEO Group pays an annual dividend of $1.92 per share and has a dividend yield of 17.3%. SL Green Realty pays out 50.6% of its earnings in the form of a dividend. The GEO Group pays out 69.8% 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. SL Green Realty has raised its dividend for 8 consecutive years and The GEO Group has raised its dividend for 7 consecutive years.
This table compares SL Green Realty and The GEO Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|SL Green Realty||27.34%||5.89%||2.58%|
|The GEO Group||6.11%||17.43%||4.06%|
This is a summary of current ratings and recommmendations for SL Green Realty and The GEO Group, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|SL Green Realty||0||10||4||0||2.29|
|The GEO Group||0||0||1||0||3.00|
SL Green Realty presently has a consensus target price of $72.79, indicating a potential upside of 45.34%. The GEO Group has a consensus target price of $15.00, indicating a potential upside of 35.38%. Given SL Green Realty’s higher probable upside, equities analysts clearly believe SL Green Realty is more favorable than The GEO Group.
Insider and Institutional Ownership
98.0% of SL Green Realty shares are owned by institutional investors. Comparatively, 75.7% of The GEO Group shares are owned by institutional investors. 4.3% of SL Green Realty shares are owned by insiders. Comparatively, 2.7% of The GEO Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Risk & Volatility
SL Green Realty has a beta of 1.61, indicating that its stock price is 61% more volatile than the S&P 500. Comparatively, The GEO Group has a beta of 1.08, indicating that its stock price is 8% more volatile than the S&P 500.
Earnings & Valuation
This table compares SL Green Realty and The GEO Group’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|SL Green Realty||$1.24 billion||3.09||$281.35 million||$7.00||7.15|
|The GEO Group||$2.48 billion||0.54||$166.60 million||$2.75||4.03|
SL Green Realty has higher earnings, but lower revenue than The GEO Group. The GEO Group is trading at a lower price-to-earnings ratio than SL Green Realty, indicating that it is currently the more affordable of the two stocks.
SL Green Realty beats The GEO Group on 12 of the 17 factors compared between the two stocks.
About SL Green Realty
SL Green Realty Corp., an S&P 500 company and New York City's largest office landlord, is a fully integrated real estate investment trust, or REIT, that is focused primarily on acquiring, managing and maximizing value of Manhattan commercial properties. As of March 31, 2019, SL Green held interests in 96 Manhattan buildings totaling 46.4 million square feet. This included ownership interests in 27.7 million square feet of Manhattan buildings and 18.7 million square feet of buildings securing debt and preferred equity investments. In addition, SL Green held ownership interests in 7 suburban properties comprised of 15 suburban buildings totaling 2.3 million square feet in Brooklyn, Westchester County, and Connecticut.
About The GEO Group
The GEO Group, Inc. (NYSE: GEO) is the first fully integrated equity real estate investment trust specializing in the design, financing, development, and operation of correctional, detention, and community reentry facilities around the globe. GEO is the world's leading provider of diversified correctional, detention, community reentry, and electronic monitoring services to government agencies worldwide with operations in the United States, Australia, South Africa, and the United Kingdom. GEO's worldwide operations include the ownership and/or management of 135 facilities totaling approximately 96,000 beds, including projects under development, with a growing workforce of approximately 23,000 professionals.
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