Medalist Diversified REIT (NASDAQ:MDRR – Get Rating) and NexPoint Residential Trust (NYSE:NXRT – Get Rating) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, earnings, dividends, analyst recommendations, institutional ownership, risk and valuation.
Insider and Institutional Ownership
19.0% of Medalist Diversified REIT shares are owned by institutional investors. Comparatively, 77.5% of NexPoint Residential Trust shares are owned by institutional investors. 2.6% of Medalist Diversified REIT shares are owned by insiders. Comparatively, 12.7% of NexPoint Residential Trust shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
This table compares Medalist Diversified REIT and NexPoint Residential Trust’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Medalist Diversified REIT||$11.47 million||1.52||-$4.36 million||($0.17)||-5.88|
|NexPoint Residential Trust||$219.24 million||8.41||$23.04 million||$0.97||73.96|
NexPoint Residential Trust has higher revenue and earnings than Medalist Diversified REIT. Medalist Diversified REIT is trading at a lower price-to-earnings ratio than NexPoint Residential Trust, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current ratings and price targets for Medalist Diversified REIT and NexPoint Residential Trust, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Medalist Diversified REIT||0||0||0||0||N/A|
|NexPoint Residential Trust||0||3||2||0||2.40|
NexPoint Residential Trust has a consensus price target of $91.33, suggesting a potential upside of 27.31%. Given NexPoint Residential Trust’s higher probable upside, analysts clearly believe NexPoint Residential Trust is more favorable than Medalist Diversified REIT.
Risk & Volatility
Medalist Diversified REIT has a beta of 0.78, suggesting that its stock price is 22% less volatile than the S&P 500. Comparatively, NexPoint Residential Trust has a beta of 0.96, suggesting that its stock price is 4% less volatile than the S&P 500.
Medalist Diversified REIT pays an annual dividend of $0.08 per share and has a dividend yield of 8.0%. NexPoint Residential Trust pays an annual dividend of $1.52 per share and has a dividend yield of 2.1%. Medalist Diversified REIT pays out -47.1% of its earnings in the form of a dividend. NexPoint Residential Trust pays out 156.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NexPoint Residential Trust has raised its dividend for 6 consecutive years. Medalist Diversified REIT is clearly the better dividend stock, given its higher yield and lower payout ratio.
This table compares Medalist Diversified REIT and NexPoint Residential Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Medalist Diversified REIT||-26.28%||-13.03%||-3.31%|
|NexPoint Residential Trust||11.12%||5.65%||1.24%|
NexPoint Residential Trust beats Medalist Diversified REIT on 14 of the 16 factors compared between the two stocks.
Medalist Diversified REIT Company Profile (Get Rating)
Medalist Diversified REIT Inc. is a Maryland corporation formed on September 28, 2015. Beginning with our taxable year ended December 31, 2017, we believe that we have operated in a manner qualifying us as a real estate investment trust (REIT), and we have elected to be taxed as a REIT for federal income tax purposes. Our company serves as the general partner of Medalist Diversified Holdings, LP which was formed as a Delaware limited partnership on September 29, 2015. Our company was formed to acquire, reposition, renovate, lease and manage income-producing properties, with a primary focus on (i) commercial properties, including flex-industrial and retail properties, (ii) multi-family residential properties and (iii) limited service hotel properties in secondary and tertiary markets in the southeastern part of the United States, with an expected concentration in Virginia, North Carolina, South Carolina, Georgia, Florida and Alabama.
NexPoint Residential Trust Company Profile (Get Rating)
NexPoint Residential Trust is a publicly traded REIT, with its shares listed on the New York Stock Exchange under the symbol "NXRT," primarily focused on acquiring, owning and operating well-located middle-income multifamily properties with "value-add" potential in large cities and suburban submarkets of large cities, primarily in the Southeastern and Southwestern United States. NXRT is externally advised by NexPoint Real Estate Advisors, L.P., an affiliate of NexPoint Advisors, L.P., an SEC-registered investment advisor, which has extensive real estate experience.
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