Innovative Industrial Properties (NYSE:IIPR) and Universal Health Realty Income Trust (NYSE:UHT) Head to Head Comparison

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

Dividends

Universal Health Realty Income Trust pays an annual dividend of $3.00 per share and has a dividend yield of 6.6%. Innovative Industrial Properties pays an annual dividend of $7.60 per share and has a dividend yield of 12.0%. Universal Health Realty Income Trust pays out 234.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Innovative Industrial Properties pays out 194.4% 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 Innovative Industrial Properties has increased 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.

Institutional and Insider Ownership

64.7% of Universal Health Realty Income Trust shares are owned by institutional investors. Comparatively, 70.6% of Innovative Industrial Properties shares are owned by institutional investors. 2.6% of Universal Health Realty Income Trust shares are owned by insiders. Comparatively, 2.0% of Innovative Industrial Properties shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Universal Health Realty Income Trust and Innovative Industrial Properties”s top-line 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	$99.19 million	6.40	$17.61 million	$1.28	35.75
Innovative Industrial Properties	$265.95 million	6.84	$118.25 million	$3.91	16.18

Innovative Industrial Properties has higher revenue and earnings than Universal Health Realty Income Trust. Innovative Industrial Properties 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.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Universal Health Realty Income Trust and Innovative Industrial Properties, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Universal Health Realty Income Trust	0	1	0	0	2.00
Innovative Industrial Properties	1	3	0	0	1.75

Innovative Industrial Properties has a consensus target price of $45.00, suggesting a potential downside of 28.87%. Given Innovative Industrial Properties’ higher possible upside, analysts clearly believe Innovative Industrial Properties is more favorable than Universal Health Realty Income Trust.

Profitability

This table compares Universal Health Realty Income Trust and Innovative Industrial Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Universal Health Realty Income Trust	18.00%	11.44%	3.15%
Innovative Industrial Properties	45.58%	6.62%	5.10%

Risk and Volatility

Universal Health Realty Income Trust has a beta of 0.82, meaning that its stock price is 18% less volatile than the S&P 500. Comparatively, Innovative Industrial Properties has a beta of 1.39, meaning that its stock price is 39% more volatile than the S&P 500.

Summary

Innovative Industrial Properties beats Universal Health Realty Income Trust on 12 of the 16 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 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.