Lineage (NASDAQ:LINE – Get Free Report) and Innovative Industrial Properties (NYSE:IIPR – Get Free Report) are both real estate companies, but which is the better investment? We will compare the two companies based on the strength of their valuation, institutional ownership, profitability, earnings, dividends, risk and analyst recommendations.
Profitability
This table compares Lineage and Innovative Industrial Properties’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Lineage | -3.15% | -1.85% | -0.89% |
| Innovative Industrial Properties | 52.27% | 7.73% | 5.69% |
Analyst Recommendations
This is a breakdown of recent recommendations and price targets for Lineage and Innovative Industrial Properties, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Lineage | 3 | 9 | 5 | 0 | 2.12 |
| Innovative Industrial Properties | 1 | 3 | 0 | 0 | 1.75 |
Dividends
Lineage pays an annual dividend of $2.13 per share and has a dividend yield of 5.5%. Innovative Industrial Properties pays an annual dividend of $7.60 per share and has a dividend yield of 13.3%. Lineage pays out -295.8% of its earnings in the form of a dividend. Innovative Industrial Properties pays out 172.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Innovative Industrial Properties has increased its dividend for 4 consecutive years. Innovative Industrial Properties is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings & Valuation
This table compares Lineage and Innovative Industrial Properties”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Lineage | $5.36 billion | 1.63 | -$100.00 million | ($0.72) | -53.33 |
| Innovative Industrial Properties | $265.95 million | 5.91 | $118.25 million | $4.41 | 12.94 |
Innovative Industrial Properties has lower revenue, but higher earnings than Lineage. Lineage is trading at a lower price-to-earnings ratio than Innovative Industrial Properties, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
70.6% of Innovative Industrial Properties shares are owned by institutional investors. 71.6% of Lineage shares are owned by insiders. Comparatively, 2.3% of Innovative Industrial Properties shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Volatility and Risk
Lineage has a beta of 0.82, indicating that its share price is 18% less volatile than the S&P 500. Comparatively, Innovative Industrial Properties has a beta of 1.35, indicating that its share price is 35% more volatile than the S&P 500.
Summary
Innovative Industrial Properties beats Lineage on 11 of the 17 factors compared between the two stocks.
About Lineage
Lineage, Inc. is the world’s largest global temperature-controlled warehouse REIT with a network of over 480 strategically located facilities totaling over 84.1 million square feet and 3.0 billion cubic feet of capacity across countries in North America, Europe, and Asia-Pacific. Coupling end-to-end supply chain solutions and technology, Lineage partners with some of the world’s largest food and beverage producers, retailers, and distributors to help increase distribution efficiency, advance sustainability, minimize supply chain waste, and, most importantly, feed the world.
About Innovative Industrial Properties
Innovative Industrial Properties, Inc. is a self-advised Maryland corporation focused on the acquisition, ownership and management of specialized properties leased to experienced, state-licensed operators for their regulated cannabis facilities. Innovative Industrial Properties, Inc. has elected to be taxed as a real estate investment trust, commencing with the year ended December 31, 2017.
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