CareTrust REIT (NYSE:CTRE) and Digital Realty Trust (NYSE:DLR) Head to Head Analysis

CareTrust REIT (NYSE:CTRE) and Digital Realty Trust (NYSE:DLR) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their risk, valuation, analyst recommendations, dividends, earnings, institutional ownership and profitability.

Dividends

CareTrust REIT pays an annual dividend of $1.34 per share and has a dividend yield of 3.2%. Digital Realty Trust pays an annual dividend of $4.88 per share and has a dividend yield of 2.5%. CareTrust REIT pays out 85.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Digital Realty Trust pays out 128.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CareTrust REIT has increased its dividend for 3 consecutive years. CareTrust REIT is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a breakdown of recent recommendations for CareTrust REIT and Digital Realty Trust, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CareTrust REIT	1	1	8	3	3.00
Digital Realty Trust	0	8	20	2	2.80

CareTrust REIT presently has a consensus target price of $42.82, indicating a potential upside of 1.77%. Digital Realty Trust has a consensus target price of $213.86, indicating a potential upside of 9.51%. Given Digital Realty Trust’s higher possible upside, analysts plainly believe Digital Realty Trust is more favorable than CareTrust REIT.

Risk & Volatility

CareTrust REIT has a beta of 0.77, suggesting that its share price is 23% less volatile than the S&P 500. Comparatively, Digital Realty Trust has a beta of 1.06, suggesting that its share price is 6% more volatile than the S&P 500.

Institutional & Insider Ownership

87.8% of CareTrust REIT shares are held by institutional investors. Comparatively, 99.7% of Digital Realty Trust shares are held by institutional investors. 0.7% of CareTrust REIT shares are held by insiders. Comparatively, 0.2% of Digital Realty Trust shares are held by 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.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
CareTrust REIT	64.10%	8.65%	6.66%
Digital Realty Trust	21.73%	6.05%	2.82%

Earnings & Valuation

This table compares CareTrust REIT and Digital Realty Trust”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CareTrust REIT	$476.39 million	20.86	$320.54 million	$1.56	26.97
Digital Realty Trust	$6.11 billion	11.23	$1.31 billion	$3.79	51.53

Digital Realty Trust has higher revenue and earnings than CareTrust REIT. CareTrust REIT 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.

Summary

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

About CareTrust REIT

CareTrust REIT, Inc. is a self-administered, publicly-traded real estate investment trust engaged in the ownership, acquisition, development and leasing of skilled nursing, seniors housing and other healthcare-related properties. With a nationwide portfolio of long-term net-leased properties, and a growing portfolio of quality operators leasing them, CareTrust REIT is pursuing both external and organic growth opportunities across the United States.

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.