Reviewing Centerspace (NYSE:CSR) and Equity Residential (NYSE:EQR)

Centerspace (NYSE:CSR) and Equity Residential (NYSE:EQR) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, risk, analyst recommendations, valuation, institutional ownership, profitability and earnings.

Profitability

This table compares Centerspace and Equity Residential’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Centerspace	6.25%	2.00%	0.86%
Equity Residential	36.20%	9.98%	5.37%

Earnings & Valuation

This table compares Centerspace and Equity Residential”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Centerspace	$273.66 million	4.11	$17.59 million	$1.00	67.05
Equity Residential	$3.09 billion	7.92	$1.12 billion	$2.93	22.33

Equity Residential has higher revenue and earnings than Centerspace. Equity Residential is trading at a lower price-to-earnings ratio than Centerspace, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Centerspace has a beta of 0.81, indicating that its stock price is 19% less volatile than the S&P 500. Comparatively, Equity Residential has a beta of 0.73, indicating that its stock price is 27% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings for Centerspace and Equity Residential, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Centerspace	0	5	2	0	2.29
Equity Residential	0	12	7	1	2.45

Centerspace presently has a consensus price target of $68.83, suggesting a potential upside of 2.67%. Equity Residential has a consensus price target of $69.66, suggesting a potential upside of 6.45%. Given Equity Residential’s stronger consensus rating and higher probable upside, analysts clearly believe Equity Residential is more favorable than Centerspace.

Dividends

Centerspace pays an annual dividend of $3.08 per share and has a dividend yield of 4.6%. Equity Residential pays an annual dividend of $2.81 per share and has a dividend yield of 4.3%. Centerspace pays out 308.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Equity Residential pays out 95.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Centerspace has increased its dividend for 2 consecutive years and Equity Residential has increased its dividend for 4 consecutive years.

Institutional and Insider Ownership

79.0% of Centerspace shares are held by institutional investors. Comparatively, 92.7% of Equity Residential shares are held by institutional investors. 0.5% of Centerspace shares are held by insiders. Comparatively, 1.0% of Equity Residential shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Equity Residential beats Centerspace on 15 of the 18 factors compared between the two stocks.

About Centerspace

Centerspace is an owner and operator of apartment communities committed to providing great homes by focusing on integrity and serving others. Founded in 1970, as of September 30, 2023, Centerspace owned interests in 71 apartment communities consisting of 12,785 apartment homes located in Colorado, Minnesota, Montana, Nebraska, North Dakota, and South Dakota. Centerspace was named a Top Workplace for the fourth consecutive year in 2023 by the Minneapolis Star Tribune.

About Equity Residential

Equity Residential is committed to creating communities where people thrive. The Company, a member of the S&P 500, is focused on the acquisition, development and management of residential properties located in and around dynamic cities that attract affluent long-term renters. Equity Residential owns or has investments in 305 properties consisting of 80,683 apartment units, with an established presence in Boston, New York, Washington, D.C., Seattle, San Francisco and Southern California, and an expanding presence in Denver, Atlanta, Dallas/Ft. Worth and Austin.