Comparing American Assets Trust (NYSE:AAT) and Hannon Armstrong Sustainable Infrastructure Capital (NYSE:HASI)

American Assets Trust (NYSE:AAT) and Hannon Armstrong Sustainable Infrastructure Capital (NYSE:HASI) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, earnings, analyst recommendations, valuation, institutional ownership, dividends and risk.

Institutional & Insider Ownership

90.4% of American Assets Trust shares are held by institutional investors. Comparatively, 96.1% of Hannon Armstrong Sustainable Infrastructure Capital shares are held by institutional investors. 37.3% of American Assets Trust shares are held by insiders. Comparatively, 2.0% of Hannon Armstrong Sustainable Infrastructure Capital shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Dividends

American Assets Trust pays an annual dividend of $1.34 per share and has a dividend yield of 5.4%. Hannon Armstrong Sustainable Infrastructure Capital pays an annual dividend of $1.66 per share and has a dividend yield of 6.0%. American Assets Trust pays out 147.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Hannon Armstrong Sustainable Infrastructure Capital pays out 93.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Hannon Armstrong Sustainable Infrastructure Capital is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a breakdown of recent recommendations for American Assets Trust and Hannon Armstrong Sustainable Infrastructure Capital, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
American Assets Trust	0	2	0	0	2.00
Hannon Armstrong Sustainable Infrastructure Capital	0	2	9	2	3.00

American Assets Trust currently has a consensus target price of $26.00, indicating a potential upside of 4.21%. Hannon Armstrong Sustainable Infrastructure Capital has a consensus target price of $40.50, indicating a potential upside of 46.69%. Given Hannon Armstrong Sustainable Infrastructure Capital’s stronger consensus rating and higher possible upside, analysts plainly believe Hannon Armstrong Sustainable Infrastructure Capital is more favorable than American Assets Trust.

Profitability

This table compares American Assets Trust and Hannon Armstrong Sustainable Infrastructure Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
American Assets Trust	12.76%	5.08%	1.89%
Hannon Armstrong Sustainable Infrastructure Capital	59.56%	11.53%	3.93%

Risk & Volatility

American Assets Trust has a beta of 1.31, meaning that its share price is 31% more volatile than the S&P 500. Comparatively, Hannon Armstrong Sustainable Infrastructure Capital has a beta of 1.94, meaning that its share price is 94% more volatile than the S&P 500.

Earnings and Valuation

This table compares American Assets Trust and Hannon Armstrong Sustainable Infrastructure Capital”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
American Assets Trust	$456.89 million	3.33	$64.69 million	$0.91	27.42
Hannon Armstrong Sustainable Infrastructure Capital	$413.05 million	7.92	$148.84 million	$1.78	15.51

Hannon Armstrong Sustainable Infrastructure Capital has lower revenue, but higher earnings than American Assets Trust. Hannon Armstrong Sustainable Infrastructure Capital is trading at a lower price-to-earnings ratio than American Assets Trust, indicating that it is currently the more affordable of the two stocks.

Summary

Hannon Armstrong Sustainable Infrastructure Capital beats American Assets Trust on 14 of the 17 factors compared between the two stocks.

About American Assets Trust

American Assets Trust, Inc. is a full service, vertically integrated and self-administered real estate investment trust ("REIT"), headquartered in San Diego, California. The company has over 55 years of experience in acquiring, improving, developing and managing premier office, retail, and residential properties throughout the United States in some of the nation's most dynamic, high-barrier-to-entry markets primarily in Southern California, Northern California, Washington, Oregon, Texas and Hawaii. The company's office portfolio comprises approximately 4.1 million rentable square feet, and its retail portfolio comprises approximately 3.1 million rentable square feet. In addition, the company owns one mixed-use property (including approximately 94,000 rentable square feet of retail space and a 369-room all-suite hotel) and 2,110 multifamily units. In 2011, the company was formed to succeed to the real estate business of American Assets, Inc., a privately held corporation founded in 1967 and, as such, has significant experience, long-standing relationships and extensive knowledge of its core markets, submarkets and asset classes.

About Hannon Armstrong Sustainable Infrastructure Capital

Hannon Armstrong Sustainable Infrastructure Capital, Inc., through its subsidiaries, engages in the investment in energy efficiency, renewable energy, and sustainable infrastructure markets in the United States. The company's portfolio includes equity investments, commercial and government receivables, real estate, and debt securities. It invests in climate solution, including Behind-the-Meter that distributes energy projects which reduce energy usage or cost through heating, ventilation, and air conditioning systems, as well as lighting, energy controls, roofs, windows, building shells, and/or combined heat and power systems; Grid-Connected, a renewable energy projects that deploy cleaner energy sources, such as solar, solar-plus-storage, and wind to generate power production; and Fuels, Transport, and Nature, a range of real assets spanning high-emitting economic sectors other than the power grid such as transportation and fuels comprising renewable natural gas plants, transportation fleet enhancements, ecological restoration, and other projects. Hannon Armstrong Sustainable Infrastructure Capital, Inc. was founded in 1981 and is headquartered in Annapolis, Maryland.