Diversified Healthcare Trust (NASDAQ:DHC) & Alexander’s (NYSE:ALX) Head-To-Head Contrast

Diversified Healthcare Trust (NASDAQ:DHC) and Alexander’s (NYSE:ALX) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, dividends, analyst recommendations, earnings, risk, valuation and institutional ownership.

Insider and Institutional Ownership

76.0% of Diversified Healthcare Trust shares are held by institutional investors. Comparatively, 32.0% of Alexander’s shares are held by institutional investors. 1.4% of Diversified Healthcare Trust shares are held by insiders. Comparatively, 26.3% of Alexander’s shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Diversified Healthcare Trust pays an annual dividend of $0.04 per share and has a dividend yield of 0.9%. Alexander’s pays an annual dividend of $18.00 per share and has a dividend yield of 7.5%. Diversified Healthcare Trust pays out -3.4% of its earnings in the form of a dividend. Alexander’s pays out 247.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Alexander’s has raised its dividend for 1 consecutive years. Alexander’s is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Diversified Healthcare Trust has a beta of 2.65, indicating that its stock price is 165% more volatile than the S&P 500. Comparatively, Alexander’s has a beta of 0.86, indicating that its stock price is 14% less volatile than the S&P 500.

Profitability

This table compares Diversified Healthcare Trust and Alexander’s’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Diversified Healthcare Trust	-18.83%	-14.69%	-5.69%
Alexander’s	17.14%	22.12%	2.79%

Earnings & Valuation

This table compares Diversified Healthcare Trust and Alexander’s”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Diversified Healthcare Trust	$1.50 billion	0.69	-$370.26 million	($1.19)	-3.57
Alexander’s	$226.37 million	5.41	$43.44 million	$7.28	32.91

Alexander’s has lower revenue, but higher earnings than Diversified Healthcare Trust. Diversified Healthcare Trust is trading at a lower price-to-earnings ratio than Alexander’s, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations for Diversified Healthcare Trust and Alexander’s, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Diversified Healthcare Trust	2	0	1	0	1.67
Alexander’s	0	2	0	0	2.00

Diversified Healthcare Trust currently has a consensus price target of $4.25, suggesting a potential upside of 0.00%. Given Diversified Healthcare Trust’s higher probable upside, equities research analysts plainly believe Diversified Healthcare Trust is more favorable than Alexander’s.

Summary

Alexander’s beats Diversified Healthcare Trust on 11 of the 17 factors compared between the two stocks.

About Diversified Healthcare Trust

Diversified Healthcare Trust is a real estate investment trust, which engages in the ownership of senior living communities, medical office buildings, and wellness centers. It operates through the following segments: Office Portfolio, Senior Housing Operating Portfolio (SHOP), and Non-Segment. The Office Portfolio segment consists of medical office properties leased to medical providers and other medical related businesses, as well as life science properties leased to biotech laboratories and other similar tenants. The SHOP segment manages senior living communities that offers short term and long term residential care, and other services for residents where it pay fees to the operator to manage the communities for its account. The company was founded on December 16, 1998 and is headquartered in Newton, MA.

About Alexander’s

Alexander’s, Inc. (NYSE: ALX) is a real estate investment trust (REIT), incorporated in Delaware, engaged in leasing, managing, developing and redeveloping its properties. All references to we, us, our, Company and Alexander’s refer to Alexander’s, Inc. and its consolidated subsidiaries. We are managed by, and our properties are leased and developed by, Vornado Realty Trust (Vornado) (NYSE: VNO). We have five properties in New York City.