NexPoint Residential Trust (NYSE:NXRT – Get Free Report) and Gladstone Land (NASDAQ:LAND – Get Free Report) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, dividends, institutional ownership, earnings, valuation, risk and analyst recommendations.
Dividends
NexPoint Residential Trust pays an annual dividend of $1.85 per share and has a dividend yield of 5.3%. Gladstone Land pays an annual dividend of $0.55 per share and has a dividend yield of 4.3%. NexPoint Residential Trust pays out 65.4% of its earnings in the form of a dividend. Gladstone Land pays out -203.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. NexPoint Residential Trust has increased its dividend for 2 consecutive years and Gladstone Land has increased its dividend for 2 consecutive years.
Analyst Recommendations
This is a breakdown of current ratings and target prices for NexPoint Residential Trust and Gladstone Land, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| NexPoint Residential Trust | 1 | 2 | 2 | 0 | 2.20 |
| Gladstone Land | 0 | 1 | 0 | 0 | 2.00 |
Insider & Institutional Ownership
76.6% of NexPoint Residential Trust shares are owned by institutional investors. Comparatively, 53.6% of Gladstone Land shares are owned by institutional investors. 13.0% of NexPoint Residential Trust shares are owned by insiders. Comparatively, 7.2% of Gladstone Land shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Profitability
This table compares NexPoint Residential Trust and Gladstone Land’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| NexPoint Residential Trust | 27.02% | 14.82% | 3.49% |
| Gladstone Land | 16.11% | 1.99% | 1.03% |
Risk and Volatility
NexPoint Residential Trust has a beta of 1.25, meaning that its stock price is 25% more volatile than the S&P 500. Comparatively, Gladstone Land has a beta of 1, meaning that its stock price has a similar volatility profile to the S&P 500.
Earnings & Valuation
This table compares NexPoint Residential Trust and Gladstone Land’s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| NexPoint Residential Trust | $275.88 million | 3.26 | $44.26 million | $2.83 | 12.31 |
| Gladstone Land | $90.40 million | 5.12 | $14.56 million | ($0.27) | -47.85 |
NexPoint Residential Trust has higher revenue and earnings than Gladstone Land. Gladstone Land 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.
Summary
NexPoint Residential Trust beats Gladstone Land on 14 of the 16 factors compared between the two stocks.
About NexPoint Residential Trust
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.
About Gladstone Land
Founded in 1997, Gladstone Land is a publicly traded real estate investment trust that acquires and owns farmland and farm-related properties located in major agricultural markets in the U.S. and leases its properties to unrelated third-party farmers. The Company, which reports the aggregate fair value of its farmland holdings on a quarterly basis, currently owns 169 farms, comprised of approximately 116,000 acres in 15 different states and over 45,000 acre-feet of banked water in California, valued at a total of approximately $1.6 billion. Gladstone Land's farms are predominantly located in regions where its tenants are able to grow fresh produce annual row crops, such as berries and vegetables, which are generally planted and harvested annually. The Company also owns farms growing permanent crops, such as almonds, apples, cherries, figs, lemons, olives, pistachios, and other orchards, as well as blueberry groves and vineyards, which are generally planted every 20-plus years and harvested annually. Approximately 40% of the Company's fresh produce acreage is either organic or in transition to become organic, and over 10% of its permanent crop acreage falls into this category. The Company may also acquire property related to farming, such as cooling facilities, processing buildings, packaging facilities, and distribution centers. Gladstone Land pays monthly distributions to its stockholders and has paid 129 consecutive monthly cash distributions on its common stock since its initial public offering in January 2013. The Company has increased its common distributions 32 times over the prior 35 quarters, and the current per-share distribution on its common stock is $0.0464 per month, or $0.5568 per year.
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