Medical Properties Trust (NYSE: MPW) and Care Capital Properties (NYSE:CCP) are both mid-cap healthcare reits companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, institutional ownership, valuation, profitability, earnings, analyst recommendations and dividends.
Valuation and Earnings
This table compares Medical Properties Trust and Care Capital Properties’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Medical Properties Trust||$541.14 million||9.13||$225.04 million||$0.76||17.84|
|Care Capital Properties||N/A||N/A||N/A||$2.90||8.35|
Medical Properties Trust has higher revenue and earnings than Care Capital Properties. Care Capital Properties is trading at a lower price-to-earnings ratio than Medical Properties Trust, indicating that it is currently the more affordable of the two stocks.
This table compares Medical Properties Trust and Care Capital Properties’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Medical Properties Trust||39.95%||7.36%||3.54%|
|Care Capital Properties||109.47%||40.07%||16.26%|
Insider & Institutional Ownership
84.7% of Medical Properties Trust shares are held by institutional investors. Comparatively, 88.9% of Care Capital Properties shares are held by institutional investors. 1.0% of Medical Properties Trust shares are held by company insiders. Comparatively, 1.7% of Care Capital Properties shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Medical Properties Trust pays an annual dividend of $0.96 per share and has a dividend yield of 7.1%. Care Capital Properties pays an annual dividend of $2.28 per share and has a dividend yield of 9.4%. Medical Properties Trust pays out 126.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Care Capital Properties pays out 78.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Care Capital Properties has increased its dividend for 3 consecutive years. Care Capital Properties is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a summary of current ratings and price targets for Medical Properties Trust and Care Capital Properties, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Medical Properties Trust||2||4||6||0||2.33|
|Care Capital Properties||0||3||0||0||2.00|
Medical Properties Trust presently has a consensus target price of $14.10, suggesting a potential upside of 3.98%. Care Capital Properties has a consensus target price of $22.50, suggesting a potential downside of 7.06%. Given Medical Properties Trust’s stronger consensus rating and higher probable upside, analysts clearly believe Medical Properties Trust is more favorable than Care Capital Properties.
Care Capital Properties beats Medical Properties Trust on 9 of the 13 factors compared between the two stocks.
Medical Properties Trust Company Profile
Medical Properties Trust, Inc. is a real estate investment trust (REIT). The Company focuses on investing in and owning net-leased healthcare facilities across the United States and selectively in foreign jurisdictions. The Company’s segment is its investments in healthcare real estate, including mortgage and other loans, as well as any equity investments in its tenants. The Company conducts its operations through MPT Operating Partnership, L.P. The Company acquires and develops healthcare facilities, and leases the facilities to healthcare operating companies under long-term net leases. The Company makes mortgage loans to healthcare operators collateralized by their real estate assets. As of February 24, 2017, the Company’s portfolio consisted of 232 properties, including 215 facilities (of the 220 facilities that it owns) were leased to 30 tenants, five were under development, and the remaining assets were in the form of mortgage loans to four operators.
Care Capital Properties Company Profile
Care Capital Properties, Inc. is a self-administered, self-managed real estate investment trust with a diversified portfolio of skilled nursing facilities (SNFs) and other healthcare assets operated by private regional and local care providers. The Company leases its properties to unaffiliated tenants under long-term triple-net leases, pursuant to which the tenants are obligated to pay all property-related expenses, including maintenance, utilities, repairs and taxes. It also manages a small portfolio of secured and unsecured loans, made primarily to its SNF operators and other post-acute care providers. As of December 31, 2016, its portfolio consisted of 345 properties operated by 38 private regional and local care providers, spread across 36 states and containing a total of approximately 38,000 beds/units. It conducts all of its operations through its operating partnership, Care Capital Properties, LP, and its subsidiaries.
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