Contrasting Essential Properties Realty Trust (NYSE:EPRT) & Broadstone Net Lease (NYSE:BNL)

Broadstone Net Lease (NYSE:BNL) and Essential Properties Realty Trust (NYSE:EPRT) are both mid-cap real estate companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, dividends, risk, profitability, institutional ownership, valuation and analyst recommendations.

Dividends

Broadstone Net Lease pays an annual dividend of $1.17 per share and has a dividend yield of 5.6%. Essential Properties Realty Trust pays an annual dividend of $1.28 per share and has a dividend yield of 4.2%. Broadstone Net Lease pays out 153.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Essential Properties Realty Trust pays out 99.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Broadstone Net Lease has increased its dividend for 4 consecutive years and Essential Properties Realty Trust has increased its dividend for 6 consecutive years.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Broadstone Net Lease and Essential Properties Realty Trust, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Broadstone Net Lease	0	4	7	0	2.64
Essential Properties Realty Trust	0	0	11	1	3.08

Broadstone Net Lease presently has a consensus target price of $22.78, suggesting a potential upside of 9.01%. Essential Properties Realty Trust has a consensus target price of $36.20, suggesting a potential upside of 18.33%. Given Essential Properties Realty Trust’s stronger consensus rating and higher probable upside, analysts clearly believe Essential Properties Realty Trust is more favorable than Broadstone Net Lease.

Institutional and Insider Ownership

89.1% of Broadstone Net Lease shares are held by institutional investors. Comparatively, 97.0% of Essential Properties Realty Trust shares are held by institutional investors. 1.0% of Broadstone Net Lease shares are held by company insiders. Comparatively, 0.8% of Essential Properties Realty Trust shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Broadstone Net Lease and Essential Properties Realty Trust”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Broadstone Net Lease	$454.14 million	8.83	$96.50 million	$0.76	27.49
Essential Properties Realty Trust	$561.22 million	11.79	$253.01 million	$1.29	23.72

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

Volatility & Risk

Broadstone Net Lease has a beta of 0.92, meaning that its share price is 8% less volatile than the S&P 500. Comparatively, Essential Properties Realty Trust has a beta of 0.86, meaning that its share price is 14% less volatile than the S&P 500.

Profitability

This table compares Broadstone Net Lease and Essential Properties Realty Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Broadstone Net Lease	30.61%	4.83%	2.54%
Essential Properties Realty Trust	43.51%	6.34%	3.81%

Summary

Essential Properties Realty Trust beats Broadstone Net Lease on 14 of the 18 factors compared between the two stocks.

About Broadstone Net Lease

Broadstone Net Lease, Inc. (the Corporation) is a Maryland corporation formed on October 18, 2007, that elected to be taxed as a real estate investment trust (REIT) commencing with the taxable year ended December 31, 2008. Broadstone Net Lease, LLC (the Corporation’s operating company, or the OP), is the entity through which the Corporation conducts its business and owns (either directly or through subsidiaries) all of the Corporation’s properties. The Corporation is the sole managing member of the OP. The membership units not owned by the Corporation are referred to as OP Units or non-controlling interests. As the Corporation conducts substantially all of its operations through the OP, it is structured as what is referred to as an umbrella partnership real estate investment trust (UPREIT). The Corporation’s common stock is listed on the New York Stock Exchange under the symbol BNL.

About Essential Properties Realty Trust

Essential Properties Realty Trust, Inc., a real estate company, acquires, owns, and manages single-tenant properties in the United States. The company leases its properties to middle-market companies, such as restaurants, car washes, automotive services, medical and dental services, convenience stores, equipment rental, entertainment, early childhood education, grocery, and health and fitness on a long-term basis. As of December 31, 2021, it had a portfolio of 1, 451 properties. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was founded in 2016 and is headquartered in Princeton, New Jersey.