Reviewing Community Healthcare Trust (NYSE:CHCT) and Alexandria Real Estate Equities (NYSE:ARE)

Alexandria Real Estate Equities (NYSE:ARE) and Community Healthcare Trust (NYSE:CHCT) are both real estate companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitability, institutional ownership, valuation, earnings and dividends.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Alexandria Real Estate Equities and Community Healthcare Trust, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alexandria Real Estate Equities	4	10	2	0	1.88
Community Healthcare Trust	0	3	2	0	2.40

Alexandria Real Estate Equities presently has a consensus target price of $51.08, indicating a potential upside of 3.99%. Community Healthcare Trust has a consensus target price of $19.25, indicating a potential upside of 8.55%. Given Community Healthcare Trust’s stronger consensus rating and higher possible upside, analysts clearly believe Community Healthcare Trust is more favorable than Alexandria Real Estate Equities.

Dividends

Alexandria Real Estate Equities pays an annual dividend of $2.88 per share and has a dividend yield of 5.9%. Community Healthcare Trust pays an annual dividend of $1.92 per share and has a dividend yield of 10.8%. Alexandria Real Estate Equities pays out -45.9% of its earnings in the form of a dividend. Community Healthcare Trust pays out 1,745.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Alexandria Real Estate Equities has raised its dividend for 15 consecutive years and Community Healthcare Trust has raised its dividend for 3 consecutive years.

Insider and Institutional Ownership

96.5% of Alexandria Real Estate Equities shares are owned by institutional investors. Comparatively, 87.8% of Community Healthcare Trust shares are owned by institutional investors. 1.4% of Alexandria Real Estate Equities shares are owned by insiders. Comparatively, 5.3% of Community Healthcare Trust shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility and Risk

Alexandria Real Estate Equities has a beta of 1.15, meaning that its stock price is 15% more volatile than the S&P 500. Comparatively, Community Healthcare Trust has a beta of 0.71, meaning that its stock price is 29% less volatile than the S&P 500.

Profitability

This table compares Alexandria Real Estate Equities and Community Healthcare Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Alexandria Real Estate Equities	-36.03%	-5.21%	-2.96%
Community Healthcare Trust	4.94%	1.41%	0.61%

Valuation & Earnings

This table compares Alexandria Real Estate Equities and Community Healthcare Trust”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alexandria Real Estate Equities	$3.03 billion	2.83	-$1.43 billion	($6.27)	-7.83
Community Healthcare Trust	$122.64 million	4.13	$5.10 million	$0.11	161.21

Community Healthcare Trust has lower revenue, but higher earnings than Alexandria Real Estate Equities. Alexandria Real Estate Equities is trading at a lower price-to-earnings ratio than Community Healthcare Trust, indicating that it is currently the more affordable of the two stocks.

Summary

Community Healthcare Trust beats Alexandria Real Estate Equities on 11 of the 16 factors compared between the two stocks.

About Alexandria Real Estate Equities

Alexandria Real Estate Equities, Inc. (NYSE: ARE), an S&P 500 company, is a best-in-class, mission-driven life science REIT making a positive and lasting impact on the world. As the pioneer of the life science real estate niche since our founding in 1994, Alexandria is the preeminent and longest-tenured owner, operator, and developer of collaborative life science, agtech, and advanced technology mega campuses in AAA innovation cluster locations, including Greater Boston, the San Francisco Bay Area, New York City, San Diego, Seattle, Maryland, and Research Triangle. Alexandria has a total market capitalization of $33.1 billion and an asset base in North America of 73.5 million SF as of December 31, 2023, which includes 42.0 million RSF of operating properties, 5.5 million RSF of Class A/A+ properties undergoing construction and one near-term project expected to commence construction in the next two years, 2.1 million RSF of priority anticipated development and redevelopment projects, and 23.9 million SF of future development projects. Alexandria has a longstanding and proven track record of developing Class A/A+ properties clustered in life science, agtech, and advanced technology mega campuses that provide our innovative tenants with highly dynamic and collaborative environments that enhance their ability to successfully recruit and retain world-class talent and inspire productivity, efficiency, creativity, and success. Alexandria also provides strategic capital to transformative life science, agrifoodtech, climate innovation, and technology companies through our venture capital platform. We believe our unique business model and diligent underwriting ensure a high-quality and diverse tenant base that results in higher occupancy levels, longer lease terms, higher rental income, higher returns, and greater long-term asset value.

About Community Healthcare Trust

Community Healthcare Trust Incorporated (the Company”, we”, our”) was organized in the State of Maryland on March 28, 2014. The Company is a fully-integrated healthcare real estate company that owns and acquires real estate properties that are leased to hospitals, doctors, healthcare systems or other healthcare service providers. As of March 31, 2024, the Company had investments of approximately $1.1 billion in 197 real estate properties (including a portion of one property accounted for as a sales-type lease with a gross amount totaling approximately $3.0 million and two properties classified as an asset held for sale with an aggregate amount totaling approximately $7.5 million. The properties are located in 35 states, totaling approximately 4.4 million square feet in the aggregate and were approximately 92.3% leased, excluding real estate assets held for sale, at March 31, 2024 with a weighted average remaining lease term of approximately 6.9 years.