Analyzing Alexander’s (NYSE:ALX) and Lamar Advertising (NASDAQ:LAMR)

Lamar Advertising (NASDAQ:LAMRGet Rating) and Alexander’s (NYSE:ALXGet Rating) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their risk, valuation, analyst recommendations, dividends, earnings, institutional ownership and profitability.

Dividends

Lamar Advertising pays an annual dividend of $4.80 per share and has a dividend yield of 5.4%. Alexander’s pays an annual dividend of $18.00 per share and has a dividend yield of 8.3%. Lamar Advertising pays out 110.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Alexander’s pays out 71.2% of its earnings in the form of a dividend. Lamar Advertising has increased its dividend for 2 consecutive years. Alexander’s is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

78.0% of Lamar Advertising shares are held by institutional investors. 15.0% of Lamar Advertising shares are held by insiders. Comparatively, 26.3% of Alexander’s shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations for Lamar Advertising and Alexander’s, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Lamar Advertising 0 2 0 0 2.00
Alexander’s 1 0 0 0 1.00

Lamar Advertising presently has a consensus target price of $117.00, indicating a potential upside of 32.43%. Alexander’s has a consensus target price of $270.00, indicating a potential upside of 24.71%. Given Lamar Advertising’s stronger consensus rating and higher possible upside, equities analysts plainly believe Lamar Advertising is more favorable than Alexander’s.

Profitability

This table compares Lamar Advertising and Alexander’s’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Lamar Advertising 23.66% 35.97% 7.47%
Alexander’s 65.05% 56.02% 9.02%

Risk & Volatility

Lamar Advertising has a beta of 1.38, suggesting that its share price is 38% more volatile than the S&P 500. Comparatively, Alexander’s has a beta of 0.56, suggesting that its share price is 44% less volatile than the S&P 500.

Valuation & Earnings

This table compares Lamar Advertising and Alexander’s’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Lamar Advertising $1.79 billion 5.02 $388.09 million $4.35 20.31
Alexander’s $206.15 million N/A $132.93 million $25.28 8.56

Lamar Advertising has higher revenue and earnings than Alexander’s. Alexander’s is trading at a lower price-to-earnings ratio than Lamar Advertising, indicating that it is currently the more affordable of the two stocks.

Summary

Lamar Advertising beats Alexander’s on 8 of the 15 factors compared between the two stocks.

Lamar Advertising Company Profile (Get Rating)

Founded in 1902, Lamar Advertising (Nasdaq: LAMR) is one of the largest outdoor advertising companies in North America, with over 352,000 displays across the United States and Canada. Lamar offers advertisers a variety of billboard, interstate logo, transit and airport advertising formats, helping both local businesses and national brands reach broad audiences every day. In addition to its more traditional out-of-home inventory, Lamar is proud to offer its customers the largest network of digital billboards in the United States with approximately 3,800 displays.

Alexander’s Company Profile (Get Rating)

Alexander's, Inc. is a real estate investment trust which has seven properties in the greater New York City metropolitan area.

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