Empire State Realty Trust (NYSE:ESRT – Get Free Report) and Net Lease Office Properties (NYSE:NLOP – Get Free Report) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, risk, valuation, institutional ownership, profitability, analyst recommendations and dividends.
Institutional & Insider Ownership
67.1% of Empire State Realty Trust shares are held by institutional investors. Comparatively, 58.3% of Net Lease Office Properties shares are held by institutional investors. 15.2% of Empire State Realty Trust shares are held by company insiders. Comparatively, 0.7% of Net Lease Office Properties shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Analyst Recommendations
This is a summary of current ratings for Empire State Realty Trust and Net Lease Office Properties, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Empire State Realty Trust | 2 | 1 | 0 | 0 | 1.33 |
| Net Lease Office Properties | 1 | 0 | 0 | 0 | 1.00 |
Dividends
Empire State Realty Trust pays an annual dividend of $0.14 per share and has a dividend yield of 2.5%. Net Lease Office Properties pays an annual dividend of $0.34 per share and has a dividend yield of 3.0%. Empire State Realty Trust pays out 53.8% of its earnings in the form of a dividend. Net Lease Office Properties pays out -4.2% 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. Net Lease Office Properties is clearly the better dividend stock, given its higher yield and lower payout ratio.
Volatility and Risk
Empire State Realty Trust has a beta of 1.35, meaning that its stock price is 35% more volatile than the S&P 500. Comparatively, Net Lease Office Properties has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500.
Earnings & Valuation
This table compares Empire State Realty Trust and Net Lease Office Properties”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Empire State Realty Trust | $768.27 million | 1.28 | $47.60 million | $0.26 | 21.90 |
| Net Lease Office Properties | $98.73 million | 1.68 | -$145.26 million | ($8.14) | -1.37 |
Empire State Realty Trust has higher revenue and earnings than Net Lease Office Properties. Net Lease Office Properties is trading at a lower price-to-earnings ratio than Empire State Realty Trust, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Empire State Realty Trust and Net Lease Office Properties’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Empire State Realty Trust | 5.09% | 2.19% | 0.93% |
| Net Lease Office Properties | -122.31% | -34.26% | -25.39% |
Summary
Empire State Realty Trust beats Net Lease Office Properties on 12 of the 15 factors compared between the two stocks.
About Empire State Realty Trust
Empire State Realty Trust, Inc. (NYSE: ESRT) is a NYC-focused REIT that owns and operates a portfolio of modernized, amenitized, and well-located office, retail, and multifamily assets. The company is the recognized leader in energy efficiency and indoor environmental quality. ESRT’s flagship Empire State Building – the “World’s Most Famous Building” – includes its Observatory, Tripadvisor’s 2023 Travelers’ Choice Awards: Best of the Best the #1 attraction in the US for two consecutive years. As of September 30, 2023, ESRT’s portfolio is comprised of approximately 8.6 million rentable square feet of office space, 0.7 million rentable square feet of retail space and 727 residential units across three multifamily properties.
About Net Lease Office Properties
Net Lease Office Properties (NYSE: NLOP) is a publicly traded real estate investment trust with a portfolio of 59 high-quality office properties, totaling approximately 8.7 million leasable square feet primarily leased to corporate tenants on a single-tenant net lease basis. The vast majority of the office properties owned by NLOP are located in the U.S., with the balance in Europe. The portfolio consists of 62 corporate tenants operating in a variety of industries, generating annualized based rent (ABR) of approximately $145 million. NLOP's business plan is to focus on realizing value for its shareholders primarily through strategic asset management and disposition of its property portfolio over time. Given WPC's extensive knowledge of the portfolio, NLOP is externally managed and advised by wholly owned affiliates of WPC to successfully execute on its business strategy. Over the course of its 50-year history, WPC has developed significant expertise in the single-tenant office real estate sector, including the operation, leasing, acquisition and development of assets through many market cycles, and has a proven track record of execution.
Receive News & Ratings for Empire State Realty Trust Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Empire State Realty Trust and related companies with MarketBeat.com's FREE daily email newsletter.
