Financial Analysis: American Assets Trust (NYSE:AAT) vs. SmartCentres Real Estate Investment Trust (OTCMKTS:CWYUF)

American Assets Trust (NYSE:AAT) and SmartCentres Real Estate Investment Trust (OTCMKTS:CWYUF) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, profitability, earnings, dividends, valuation, risk and analyst recommendations.

Profitability

This table compares American Assets Trust and SmartCentres Real Estate Investment Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
American Assets Trust	13.98%	5.43%	2.03%
SmartCentres Real Estate Investment Trust	33.37%	4.41%	2.32%

Volatility & Risk

American Assets Trust has a beta of 1.23, suggesting that its share price is 23% more volatile than the S&P 500. Comparatively, SmartCentres Real Estate Investment Trust has a beta of 0.91, suggesting that its share price is 9% less volatile than the S&P 500.

Insider & Institutional Ownership

90.4% of American Assets Trust shares are held by institutional investors. 36.8% of American Assets Trust shares are held by company insiders. Comparatively, 20.9% of SmartCentres Real Estate Investment Trust shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

American Assets Trust pays an annual dividend of $1.36 per share and has a dividend yield of 7.1%. SmartCentres Real Estate Investment Trust pays an annual dividend of $1.34 per share and has a dividend yield of 7.1%. American Assets Trust pays out 134.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. SmartCentres Real Estate Investment Trust pays out 118.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. American Assets Trust has raised its dividend for 4 consecutive years. American Assets Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of recent ratings and price targets for American Assets Trust and SmartCentres Real Estate Investment Trust, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
American Assets Trust	0	3	0	0	2.00
SmartCentres Real Estate Investment Trust	0	0	0	1	4.00

American Assets Trust presently has a consensus target price of $20.50, suggesting a potential upside of 7.08%. Given American Assets Trust’s higher possible upside, equities research analysts clearly believe American Assets Trust is more favorable than SmartCentres Real Estate Investment Trust.

Valuation and Earnings

This table compares American Assets Trust and SmartCentres Real Estate Investment Trust”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
American Assets Trust	$439.58 million	2.66	$72.82 million	$1.01	18.96
SmartCentres Real Estate Investment Trust	$670.29 million	5.02	$172.78 million	$1.13	16.70

SmartCentres Real Estate Investment Trust has higher revenue and earnings than American Assets Trust. SmartCentres Real Estate Investment Trust is trading at a lower price-to-earnings ratio than American Assets Trust, indicating that it is currently the more affordable of the two stocks.

Summary

SmartCentres Real Estate Investment Trust beats American Assets Trust on 9 of the 17 factors compared between the two stocks.

About American Assets Trust

American Assets Trust, Inc. is a full service, vertically integrated and self-administered real estate investment trust ("REIT"), headquartered in San Diego, California. The company has over 55 years of experience in acquiring, improving, developing and managing premier office, retail, and residential properties throughout the United States in some of the nation's most dynamic, high-barrier-to-entry markets primarily in Southern California, Northern California, Washington, Oregon, Texas and Hawaii. The company's office portfolio comprises approximately 4.1 million rentable square feet, and its retail portfolio comprises approximately 3.1 million rentable square feet. In addition, the company owns one mixed-use property (including approximately 94,000 rentable square feet of retail space and a 369-room all-suite hotel) and 2,110 multifamily units. In 2011, the company was formed to succeed to the real estate business of American Assets, Inc., a privately held corporation founded in 1967 and, as such, has significant experience, long-standing relationships and extensive knowledge of its core markets, submarkets and asset classes.

About SmartCentres Real Estate Investment Trust

SmartCentres is one of Canada’s largest fully integrated REITs, with a best-in-class and growing mixed-use portfolio featuring 191 strategically located properties in communities across the country. SmartCentres has approximately $12.0 billion in assets and owns 35.0 million square feet of income producing value-oriented retail and first-class office properties with 98.5% in place and committed occupancy, on 3,500 acres of owned land across Canada.