Reviewing Paramount Group (NYSE:PGRE) and Equinix (NASDAQ:EQIX)

Paramount Group (NYSE:PGREGet Rating) and Equinix (NASDAQ:EQIXGet Rating) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, dividends, risk, profitability and valuation.

Volatility & Risk

Paramount Group has a beta of 1.11, meaning that its stock price is 11% more volatile than the S&P 500. Comparatively, Equinix has a beta of 0.46, meaning that its stock price is 54% less volatile than the S&P 500.

Profitability

This table compares Paramount Group and Equinix’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Paramount Group -2.80% -0.45% -0.24%
Equinix 7.54% 6.65% 2.56%

Insider and Institutional Ownership

52.8% of Paramount Group shares are held by institutional investors. Comparatively, 94.4% of Equinix shares are held by institutional investors. 9.8% of Paramount Group shares are held by insiders. Comparatively, 13.2% of Equinix shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Paramount Group and Equinix’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Paramount Group $726.79 million 3.24 -$20.35 million ($0.09) -119.32
Equinix $6.64 billion 10.51 $500.19 million $5.54 138.77

Equinix has higher revenue and earnings than Paramount Group. Paramount Group is trading at a lower price-to-earnings ratio than Equinix, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Paramount Group and Equinix, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Paramount Group 2 1 2 0 2.00
Equinix 0 6 11 1 2.72

Paramount Group currently has a consensus price target of $11.20, suggesting a potential upside of 4.28%. Equinix has a consensus price target of $853.12, suggesting a potential upside of 10.97%. Given Equinix’s stronger consensus rating and higher possible upside, analysts plainly believe Equinix is more favorable than Paramount Group.

Dividends

Paramount Group pays an annual dividend of $0.31 per share and has a dividend yield of 2.9%. Equinix pays an annual dividend of $12.40 per share and has a dividend yield of 1.6%. Paramount Group pays out -344.4% of its earnings in the form of a dividend. Equinix pays out 223.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Paramount Group has increased its dividend for 1 consecutive years and Equinix has increased its dividend for 7 consecutive years. Paramount Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Equinix beats Paramount Group on 15 of the 18 factors compared between the two stocks.

Paramount Group Company Profile (Get Rating)

Headquartered in New York City, Paramount Group, Inc. is a fully-integrated real estate investment trust that owns, operates, manages, acquires and redevelops high-quality, Class A office properties located in select central business district submarkets of New York City and San Francisco. Paramount is focused on maximizing the value of its portfolio by leveraging the sought-after locations of its assets and its proven property management capabilities to attract and retain high-quality tenants.

Equinix Company Profile (Get Rating)

Equinix (Nasdaq: EQIX) is the world's digital infrastructure company, enabling digital leaders to harness a trusted platform to bring together and interconnect the foundational infrastructure that powers their success. Equinix enables today's businesses to access all the right places, partners and possibilities they need to accelerate advantage. With Equinix, they can scale with agility, speed the launch of digital services, deliver world-class experiences and multiply their value.

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