Financial Comparison: Hudson Pacific Properties (NYSE:HPP) vs. Highlands REIT (OTCMKTS:HHDS)

Hudson Pacific Properties (NYSE:HPP) and Highlands REIT (OTCMKTS:HHDS) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, valuation, risk, dividends, institutional ownership, analyst recommendations and earnings.

Profitability

This table compares Hudson Pacific Properties and Highlands REIT’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hudson Pacific Properties	-53.76%	-15.10%	-5.27%
Highlands REIT	-25.09%	-4.66%	-2.80%

Earnings & Valuation

This table compares Hudson Pacific Properties and Highlands REIT”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hudson Pacific Properties	$784.74 million	0.93	-$352.29 million	($2.42)	-0.79
Highlands REIT	$36.08 million	0.36	-$1.00 million	N/A	N/A

Highlands REIT has lower revenue, but higher earnings than Hudson Pacific Properties.

Volatility and Risk

Hudson Pacific Properties has a beta of 1.62, indicating that its stock price is 62% more volatile than the S&P 500. Comparatively, Highlands REIT has a beta of 4.4, indicating that its stock price is 340% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and price targets for Hudson Pacific Properties and Highlands REIT, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hudson Pacific Properties	2	6	5	0	2.23
Highlands REIT	0	0	0	0	0.00

Hudson Pacific Properties presently has a consensus target price of $3.13, suggesting a potential upside of 63.62%. Given Hudson Pacific Properties’ stronger consensus rating and higher possible upside, equities analysts clearly believe Hudson Pacific Properties is more favorable than Highlands REIT.

Insider & Institutional Ownership

97.6% of Hudson Pacific Properties shares are owned by institutional investors. Comparatively, 0.0% of Highlands REIT shares are owned by institutional investors. 4.9% of Hudson Pacific Properties shares are owned by company insiders. Comparatively, 4.0% of Highlands REIT shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

Hudson Pacific Properties beats Highlands REIT on 7 of the 13 factors compared between the two stocks.

About Hudson Pacific Properties

Hudson Pacific Properties (NYSE: HPP) is a real estate investment trust serving dynamic tech and media tenants in global epicenters for these synergistic, converging and secular growth industries. Hudson Pacific's unique and high-barrier tech and media focus leverages a full-service, end-to-end value creation platform forged through deep strategic relationships and niche expertise across identifying, acquiring, transforming and developing properties into world-class amenitized, collaborative and sustainable office and studio space.

About Highlands REIT

We are a self-advised and self-administered real estate investment trust (REIT) created to own and manage substantially all of the non-core investment properties previously owned and managed by our former parent, InvenTrust Properties Corp., a Maryland corporation (InvenTrust). On April 28, 2016, we were spun-off from InvenTrust through a pro rata distribution (the Distribution) by InvenTrust of 100% of the outstanding shares of our common stock to holders of InvenTrust's common stock. Prior to or concurrent with the separation, we and InvenTrust engaged in certain reorganization transactions that were designed to consolidate substantially all of InvenTrust's remaining non-core investment properties in Highlands.