Digital Realty Trust (NYSE:DLR) and Safehold (NYSE:SAFE) Head-To-Head Analysis

Digital Realty Trust (NYSE:DLR) and Safehold (NYSE:SAFE) are both real estate companies, but which is the better business? We will compare the two companies based on the strength of their dividends, institutional ownership, profitability, earnings, analyst recommendations, valuation and risk.

Institutional and Insider Ownership

99.7% of Digital Realty Trust shares are held by institutional investors. Comparatively, 70.4% of Safehold shares are held by institutional investors. 0.2% of Digital Realty Trust shares are held by insiders. Comparatively, 3.8% of Safehold shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares Digital Realty Trust and Safehold”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Digital Realty Trust	$6.11 billion	11.43	$1.31 billion	$2.06	91.43
Safehold	$385.55 million	2.79	$114.47 million	$1.62	9.37

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

Profitability

This table compares Digital Realty Trust and Safehold’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Digital Realty Trust	11.80%	3.34%	1.59%
Safehold	27.70%	4.76%	1.62%

Risk and Volatility

Digital Realty Trust has a beta of 1.02, suggesting that its stock price is 2% more volatile than the S&P 500. Comparatively, Safehold has a beta of 1.73, suggesting that its stock price is 73% more volatile than the S&P 500.

Dividends

Digital Realty Trust pays an annual dividend of $4.88 per share and has a dividend yield of 2.6%. Safehold pays an annual dividend of $0.71 per share and has a dividend yield of 4.7%. Digital Realty Trust pays out 236.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Safehold pays out 43.8% of its earnings in the form of a dividend. Safehold has raised its dividend for 1 consecutive years. Safehold is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Digital Realty Trust and Safehold, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Digital Realty Trust	0	6	25	1	2.84
Safehold	1	7	2	0	2.10

Digital Realty Trust presently has a consensus price target of $219.45, suggesting a potential upside of 16.51%. Safehold has a consensus price target of $17.17, suggesting a potential upside of 13.09%. Given Digital Realty Trust’s stronger consensus rating and higher probable upside, equities analysts clearly believe Digital Realty Trust is more favorable than Safehold.

Summary

Digital Realty Trust beats Safehold on 10 of the 18 factors compared between the two stocks.

About Digital Realty Trust

Digital Realty Trust, Inc. operates as a real estate investment trust, which engages in the provision of data center, colocation and interconnection solutions. It serves the following industries: artificial intelligence (AI), networks, cloud, digital media, mobile, financial services, healthcare, and gaming. The company was founded on March 9, 2004, and is headquartered in Dallas, TX.

About Safehold

Safehold Inc. (NYSE: SAFE) is revolutionizing real estate ownership by providing a new and better way for owners to unlock the value of the land beneath their buildings. Having created the modern ground lease industry in 2017, Safehold continues to help owners of high quality multifamily, office, industrial, hospitality, student housing, life science and mixed-use properties generate higher returns with less risk. The Company, which is taxed as a real estate investment trust (REIT), seeks to deliver safe, growing income and long-term capital appreciation to its shareholders.