Head-To-Head Survey: Highwoods Properties (NYSE:HIW) and Empire State Realty Trust (NYSE:ESRT)

Empire State Realty Trust (NYSE:ESRT) and Highwoods Properties (NYSE:HIW) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, earnings, profitability, valuation, risk, institutional ownership and dividends.

Insider and Institutional Ownership

67.1% of Empire State Realty Trust shares are held by institutional investors. Comparatively, 96.3% of Highwoods Properties shares are held by institutional investors. 15.2% of Empire State Realty Trust shares are held by company insiders. Comparatively, 1.3% of Highwoods Properties shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and target prices for Empire State Realty Trust and Highwoods Properties, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Empire State Realty Trust	2	1	0	0	1.33
Highwoods Properties	0	6	2	0	2.25

Empire State Realty Trust presently has a consensus price target of $6.35, indicating a potential upside of 16.39%. Highwoods Properties has a consensus price target of $27.67, indicating a potential upside of 19.29%. Given Highwoods Properties’ stronger consensus rating and higher probable upside, analysts clearly believe Highwoods Properties is more favorable than Empire State Realty Trust.

Earnings and Valuation

This table compares Empire State Realty Trust and Highwoods Properties”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Empire State Realty Trust	$768.27 million	1.22	$47.60 million	$0.26	20.98
Highwoods Properties	$806.11 million	3.17	$159.61 million	$1.46	15.88

Highwoods Properties has higher revenue and earnings than Empire State Realty Trust. Highwoods 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.

Dividends

Empire State Realty Trust pays an annual dividend of $0.14 per share and has a dividend yield of 2.6%. Highwoods Properties pays an annual dividend of $2.00 per share and has a dividend yield of 8.6%. Empire State Realty Trust pays out 53.8% of its earnings in the form of a dividend. Highwoods Properties pays out 137.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Volatility & Risk

Empire State Realty Trust has a beta of 1.38, meaning that its share price is 38% more volatile than the S&P 500. Comparatively, Highwoods Properties has a beta of 1.05, meaning that its share price is 5% more volatile than the S&P 500.

Profitability

This table compares Empire State Realty Trust and Highwoods Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Empire State Realty Trust	6.06%	2.59%	1.11%
Highwoods Properties	20.10%	6.86%	2.64%

Summary

Highwoods Properties beats Empire State Realty Trust on 13 of the 16 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 Highwoods Properties

Highwoods Properties, Inc., headquartered in Raleigh, is a publicly-traded (NYSE:HIW), fully-integrated office real estate investment trust (REIT) that owns, develops, acquires, leases and manages properties primarily in the best business districts (BBDs) of Atlanta, Charlotte, Dallas, Nashville, Orlando, Raleigh, Richmond and Tampa. Highwoods is in the work-placemaking business. We believe that by creating environments and experiences where the best and brightest can achieve together what they cannot apart, we can deliver greater value to our customers, their teammates and, in turn, our stakeholders.