Analyzing Independence Realty Trust (NYSE:IRT) and Safehold (NYSE:SAFE)

Independence Realty Trust (NYSE:IRT) and Safehold (NYSE:SAFE) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, analyst recommendations, profitability, dividends and earnings.

Valuation and Earnings

This table compares Independence Realty Trust and Safehold”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Independence Realty Trust	$640.03 million	6.37	$39.29 million	$0.12	145.33
Safehold	$374.10 million	2.93	$105.76 million	$1.43	10.66

Safehold has lower revenue, but higher earnings than Independence Realty Trust. Safehold is trading at a lower price-to-earnings ratio than Independence Realty Trust, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Independence Realty Trust and Safehold’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Independence Realty Trust	4.31%	0.78%	0.46%
Safehold	27.45%	4.70%	1.61%

Dividends

Independence Realty Trust pays an annual dividend of $0.68 per share and has a dividend yield of 3.9%. Safehold pays an annual dividend of $0.70 per share and has a dividend yield of 4.6%. Independence Realty Trust pays out 566.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Safehold pays out 49.0% of its earnings in the form of a dividend. Independence Realty Trust has raised its dividend for 3 consecutive years and Safehold has raised its dividend for 1 consecutive years. Safehold is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

88.3% of Independence Realty Trust shares are held by institutional investors. Comparatively, 70.4% of Safehold shares are held by institutional investors. 0.6% of Independence Realty Trust shares are held by company insiders. Comparatively, 3.5% of Safehold shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

Independence Realty Trust has a beta of 0.94, indicating that its stock price is 6% less volatile than the S&P 500. Comparatively, Safehold has a beta of 1.83, indicating that its stock price is 83% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Independence Realty Trust and Safehold, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Independence Realty Trust	0	2	7	0	2.78
Safehold	0	5	4	0	2.44

Independence Realty Trust currently has a consensus target price of $22.5556, suggesting a potential upside of 29.33%. Safehold has a consensus target price of $21.8889, suggesting a potential upside of 43.53%. Given Safehold’s higher possible upside, analysts plainly believe Safehold is more favorable than Independence Realty Trust.

Summary

Safehold beats Independence Realty Trust on 10 of the 17 factors compared between the two stocks.

About Independence Realty Trust

Independence Realty Trust, Inc. (NYSE: IRT) is a real estate investment trust that owns and operates multifamily communities, across non-gateway U.S. markets including Atlanta, GA, Dallas, TX, Denver, CO, Columbus, OH, Indianapolis, IN, Raleigh-Durham, NC, Oklahoma City, OK, Nashville, TN, Houston, TX, and Tampa, FL. IRT’s investment strategy is focused on gaining scale near major employment centers within key amenity rich submarkets that offer good school districts and high-quality retail. IRT aims to provide stockholders attractive risk-adjusted returns through diligent portfolio management, strong operational performance, and a consistent return on capital through distributions and capital appreciation.

About Safehold

Safehold Inc. (NYSE: SAFE) is revolutionizing real estate ownership by providing a new and better way for owners to unlock the value of the land beneath their buildings. Having created the modern ground lease industry in 2017, Safehold continues to help owners of high quality multifamily, office, industrial, hospitality, student housing, life science and mixed-use properties generate higher returns with less risk. The Company, which is taxed as a real estate investment trust (REIT), seeks to deliver safe, growing income and long-term capital appreciation to its shareholders.