The RMR Group (NASDAQ:RMR – Get Free Report) and Kennedy-Wilson (NYSE:KW – Get Free Report) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, earnings, dividends, profitability, valuation and risk.
Dividends
The RMR Group pays an annual dividend of $1.80 per share and has a dividend yield of 11.4%. Kennedy-Wilson pays an annual dividend of $0.48 per share and has a dividend yield of 6.6%. The RMR Group pays out 148.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Kennedy-Wilson pays out -45.7% of its earnings in the form of a dividend. The RMR Group has increased its dividend for 1 consecutive years. The RMR Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Analyst Ratings
This is a breakdown of recent recommendations and price targets for The RMR Group and Kennedy-Wilson, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| The RMR Group | 0 | 0 | 0 | 1 | 4.00 |
| Kennedy-Wilson | 0 | 2 | 0 | 0 | 2.00 |
Profitability
This table compares The RMR Group and Kennedy-Wilson’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| The RMR Group | 2.51% | 5.35% | 3.39% |
| Kennedy-Wilson | -19.24% | 7.76% | 0.92% |
Valuation & Earnings
This table compares The RMR Group and Kennedy-Wilson”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| The RMR Group | $897.20 million | 0.56 | $23.13 million | $1.21 | 13.02 |
| Kennedy-Wilson | $531.40 million | 1.88 | -$33.00 million | ($1.05) | -6.89 |
The RMR Group has higher revenue and earnings than Kennedy-Wilson. Kennedy-Wilson is trading at a lower price-to-earnings ratio than The RMR Group, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
The RMR Group has a beta of 1.15, indicating that its stock price is 15% more volatile than the S&P 500. Comparatively, Kennedy-Wilson has a beta of 1.1, indicating that its stock price is 10% more volatile than the S&P 500.
Insider and Institutional Ownership
42.3% of The RMR Group shares are held by institutional investors. Comparatively, 87.7% of Kennedy-Wilson shares are held by institutional investors. 54.9% of The RMR Group shares are held by insiders. Comparatively, 20.3% of Kennedy-Wilson shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Summary
The RMR Group beats Kennedy-Wilson on 13 of the 17 factors compared between the two stocks.
About The RMR Group
The RMR Group Inc., through its subsidiary, The RMR Group LLC, provides asset management services in the United States. The company offers management services to its four publicly traded real estate investment trusts, three real estate operating companies, and private capital vehicles. It also provides advisory services to publicly traded mortgage real estate investment trust. The company was formerly known as REIT Management & Research Inc. and changed its name to The RMR Group Inc. in October 2015. The RMR Group Inc. was founded in 1986 and is headquartered in Newton, Massachusetts.
About Kennedy-Wilson
Kennedy-Wilson Holdings, Inc., together with its subsidiaries, operates as a real estate investment company. The company owns, operates, and invests in real estate both on its own and through its investment management platform. It focuses on multifamily and office properties located in the Western United States, the United Kingdom, Ireland, Spain, Italy, and Japan. The company had ownership interests in multifamily units, office space, retail and industrial space, and a hotel. It is involved in the development, redevelopment, and entitlement of real estate properties. Kennedy-Wilson Holdings, Inc. was founded in 1977 and is headquartered in Beverly Hills, California.
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