Financial Review: Simon Property Group (NYSE:SPG) and First Industrial Realty Trust (NYSE:FR)

First Industrial Realty Trust (NYSE:FR) and Simon Property Group (NYSE:SPG) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, risk, valuation, earnings and dividends.

Risk and Volatility

First Industrial Realty Trust has a beta of 1.07, suggesting that its stock price is 7% more volatile than the S&P 500. Comparatively, Simon Property Group has a beta of 1.45, suggesting that its stock price is 45% more volatile than the S&P 500.

Institutional & Insider Ownership

99.8% of First Industrial Realty Trust shares are held by institutional investors. Comparatively, 93.0% of Simon Property Group shares are held by institutional investors. 0.9% of First Industrial Realty Trust shares are held by company insiders. Comparatively, 8.5% of Simon Property Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Dividends

First Industrial Realty Trust pays an annual dividend of $1.78 per share and has a dividend yield of 4.0%. Simon Property Group pays an annual dividend of $8.40 per share and has a dividend yield of 5.7%. First Industrial Realty Trust pays out 81.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Simon Property Group pays out 115.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. First Industrial Realty Trust has raised its dividend for 12 consecutive years.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for First Industrial Realty Trust and Simon Property Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Industrial Realty Trust	1	6	7	0	2.43
Simon Property Group	0	4	5	0	2.56

First Industrial Realty Trust presently has a consensus target price of $57.77, indicating a potential upside of 28.91%. Simon Property Group has a consensus target price of $181.39, indicating a potential upside of 22.86%. Given First Industrial Realty Trust’s higher probable upside, analysts clearly believe First Industrial Realty Trust is more favorable than Simon Property Group.

Profitability

This table compares First Industrial Realty Trust and Simon Property Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Industrial Realty Trust	42.94%	10.64%	5.51%
Simon Property Group	41.49%	74.02%	7.46%

Valuation & Earnings

This table compares First Industrial Realty Trust and Simon Property Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Industrial Realty Trust	$669.64 million	8.86	$287.55 million	$2.18	20.56
Simon Property Group	$5.96 billion	8.08	$2.37 billion	$7.26	20.34

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

Summary

Simon Property Group beats First Industrial Realty Trust on 9 of the 17 factors compared between the two stocks.

About First Industrial Realty Trust

First Industrial Realty Trust, Inc. (NYSE: FR) is a leading U.S.-only owner, operator, developer and acquirer of logistics properties. Through our fully integrated operating and investing platform, we provide high quality facilities and industry-leading customer service to multinational corporations and regional firms that are essential for their supply chains. Our portfolio and new investments are concentrated in 15 target MSAs with an emphasis on supply-constrained, coastally oriented markets. In total, we own and have under development approximately 68.5 million square feet of industrial space as of December 31, 2023.

About Simon Property Group

Simon Property Group, Inc. (NYSE:SPG) is a self-administered and self-managed real estate investment trust (REIT). Simon Property Group, L.P., or the Operating Partnership, is our majority-owned partnership subsidiary that owns all of our real estate properties and other assets. In this package, the terms Simon, we, our, or the Company refer to Simon Property Group, Inc., the Operating Partnership, and its subsidiaries. We own, develop and manage premier shopping, dining, entertainment and mixed-use destinations, which consist primarily of malls, Premium Outlets, The Mills, and International Properties. At June 30, 2024, we owned or had an interest in 230 properties comprising 183 million square feet in North America, Asia and Europe. We also owned an 84% interest in The Taubman Realty Group, or TRG, which owns 22 regional, super-regional, and outlet malls in the U.S. and Asia. Additionally, at June 30, 2024, we had a 22.4% ownership interest in Klépierre, a publicly traded, Paris-based real estate company, which owns shopping centers in 14 European countries.