Critical Contrast: Universal Health Realty Income Trust (NYSE:UHT) versus Lamar Advertising (NASDAQ:LAMR)

Universal Health Realty Income Trust (NYSE:UHT) and Lamar Advertising (NASDAQ:LAMR) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, valuation, analyst recommendations, dividends, risk, institutional ownership and earnings.

Volatility & Risk

Universal Health Realty Income Trust has a beta of 0.97, meaning that its stock price is 3% less volatile than the S&P 500. Comparatively, Lamar Advertising has a beta of 1.36, meaning that its stock price is 36% more volatile than the S&P 500.

Profitability

This table compares Universal Health Realty Income Trust and Lamar Advertising’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Universal Health Realty Income Trust	18.06%	10.63%	3.13%
Lamar Advertising	19.72%	41.85%	6.68%

Insider & Institutional Ownership

64.7% of Universal Health Realty Income Trust shares are owned by institutional investors. Comparatively, 93.8% of Lamar Advertising shares are owned by institutional investors. 2.4% of Universal Health Realty Income Trust shares are owned by company insiders. Comparatively, 15.0% of Lamar Advertising shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Universal Health Realty Income Trust and Lamar Advertising”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Universal Health Realty Income Trust	$99.36 million	5.41	$19.23 million	$1.29	30.01
Lamar Advertising	$2.25 billion	5.65	$361.87 million	$4.26	29.48

Lamar Advertising has higher revenue and earnings than Universal Health Realty Income Trust. Lamar Advertising is trading at a lower price-to-earnings ratio than Universal Health Realty Income Trust, indicating that it is currently the more affordable of the two stocks.

Dividends

Universal Health Realty Income Trust pays an annual dividend of $2.96 per share and has a dividend yield of 7.6%. Lamar Advertising pays an annual dividend of $6.20 per share and has a dividend yield of 4.9%. Universal Health Realty Income Trust pays out 229.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Lamar Advertising pays out 145.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Universal Health Realty Income Trust has increased its dividend for 2 consecutive years and Lamar Advertising has increased its dividend for 5 consecutive years.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Universal Health Realty Income Trust and Lamar Advertising, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Universal Health Realty Income Trust	0	1	0	0	2.00
Lamar Advertising	0	4	2	0	2.33

Lamar Advertising has a consensus target price of $134.20, indicating a potential upside of 6.86%. Given Lamar Advertising’s stronger consensus rating and higher possible upside, analysts plainly believe Lamar Advertising is more favorable than Universal Health Realty Income Trust.

Summary

Lamar Advertising beats Universal Health Realty Income Trust on 15 of the 17 factors compared between the two stocks.

About Universal Health Realty Income Trust

Universal Health Realty Income Trust, a real estate investment trust, invests in healthcare and human-service related facilities including acute care hospitals, behavioral health care hospitals, specialty facilities, medical/office buildings, free-standing emergency departments and childcare centers. We have investments or commitments in seventy-six properties located in twenty-one states.

About Lamar Advertising

Lamar Advertising Company operates as an outdoor advertising company in the United States and Canada. The company owns and operates billboards, logo signs, and transit advertising displays, as well as rents space for advertising on billboards, buses, shelters, benches, logo plates, and in airport terminals. Lamar Advertising Company was founded in 1902 and is headquartered in Baton Rouge, Louisiana.