Contrasting Innovative Industrial Properties (NYSE:IIPR) & Clipper Realty (NYSE:CLPR)

Innovative Industrial Properties (NYSE:IIPR) and Clipper Realty (NYSE:CLPR) are both small-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, earnings, profitability, analyst recommendations, risk, institutional ownership and dividends.

Analyst Ratings

This is a breakdown of current ratings for Innovative Industrial Properties and Clipper Realty, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Innovative Industrial Properties	2	3	1	0	1.83
Clipper Realty	0	1	0	0	2.00

Innovative Industrial Properties currently has a consensus price target of $68.20, suggesting a potential upside of 36.56%. Given Innovative Industrial Properties’ higher probable upside, equities analysts plainly believe Innovative Industrial Properties is more favorable than Clipper Realty.

Dividends

Innovative Industrial Properties pays an annual dividend of $7.60 per share and has a dividend yield of 15.2%. Clipper Realty pays an annual dividend of $0.38 per share and has a dividend yield of 10.1%. Innovative Industrial Properties pays out 180.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Clipper Realty pays out -33.9% of its earnings in the form of a dividend. Innovative Industrial Properties has raised its dividend for 4 consecutive years. Innovative Industrial Properties is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Innovative Industrial Properties and Clipper Realty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Innovative Industrial Properties	45.80%	6.77%	5.40%
Clipper Realty	-10.40%	N/A	-1.28%

Volatility & Risk

Innovative Industrial Properties has a beta of 1.5, meaning that its stock price is 50% more volatile than the S&P 500. Comparatively, Clipper Realty has a beta of 1.01, meaning that its stock price is 1% more volatile than the S&P 500.

Earnings and Valuation

This table compares Innovative Industrial Properties and Clipper Realty”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Innovative Industrial Properties	$308.52 million	4.54	$161.66 million	$4.22	11.83
Clipper Realty	$148.77 million	0.41	-$2.50 million	($1.12)	-3.35

Innovative Industrial Properties has higher revenue and earnings than Clipper Realty. Clipper Realty is trading at a lower price-to-earnings ratio than Innovative Industrial Properties, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

70.6% of Innovative Industrial Properties shares are owned by institutional investors. Comparatively, 37.6% of Clipper Realty shares are owned by institutional investors. 2.0% of Innovative Industrial Properties shares are owned by company insiders. Comparatively, 53.0% of Clipper Realty shares are owned by company 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.

Summary

Innovative Industrial Properties beats Clipper Realty on 14 of the 17 factors compared between the two stocks.

About Innovative Industrial Properties

Innovative Industrial Properties, Inc. is a self-advised Maryland corporation focused on the acquisition, ownership and management of specialized properties leased to experienced, state-licensed operators for their regulated cannabis facilities. Innovative Industrial Properties, Inc. has elected to be taxed as a real estate investment trust, commencing with the year ended December 31, 2017.

About Clipper Realty

Clipper Realty Inc. (NYSE: CLPR) is a self-administered and self-managed real estate company that acquires, owns, manages, operates, and repositions multifamily residential and commercial properties in the New York metropolitan area, with a portfolio in Manhattan and Brooklyn.