Head to Head Analysis: Highwoods Properties (NYSE:HIW) vs. NETSTREIT (NYSE:NTST)

Highwoods Properties (NYSE:HIW) and NETSTREIT (NYSE:NTST) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, profitability, risk, earnings and valuation.

Profitability

This table compares Highwoods Properties and NETSTREIT’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Highwoods Properties	15.78%	5.44%	2.18%
NETSTREIT	4.57%	0.52%	0.34%

Volatility & Risk

Highwoods Properties has a beta of 1.23, indicating that its stock price is 23% more volatile than the S&P 500. Comparatively, NETSTREIT has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500.

Dividends

Highwoods Properties pays an annual dividend of $2.00 per share and has a dividend yield of 7.5%. NETSTREIT pays an annual dividend of $0.82 per share and has a dividend yield of 4.7%. Highwoods Properties pays out 163.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NETSTREIT pays out 911.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NETSTREIT has raised its dividend for 3 consecutive years. Highwoods Properties is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

96.3% of Highwoods Properties shares are held by institutional investors. 1.6% of Highwoods Properties shares are held by insiders. Comparatively, 0.5% of NETSTREIT shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Highwoods Properties and NETSTREIT’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Highwoods Properties	$834.00 million	3.40	$148.71 million	$1.22	21.94
NETSTREIT	$131.90 million	9.66	$6.84 million	$0.09	192.91

Highwoods Properties has higher revenue and earnings than NETSTREIT. Highwoods Properties is trading at a lower price-to-earnings ratio than NETSTREIT, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings for Highwoods Properties and NETSTREIT, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Highwoods Properties	1	5	2	0	2.13
NETSTREIT	1	2	5	0	2.50

Highwoods Properties presently has a consensus target price of $24.38, suggesting a potential downside of 8.95%. NETSTREIT has a consensus target price of $18.11, suggesting a potential upside of 4.30%. Given NETSTREIT’s stronger consensus rating and higher possible upside, analysts clearly believe NETSTREIT is more favorable than Highwoods Properties.

Summary

Highwoods Properties beats NETSTREIT on 11 of the 17 factors compared between the two stocks.

About Highwoods Properties

Highwoods Properties, Inc., headquartered in Raleigh, is a publicly-traded (NYSE:HIW), fully-integrated office real estate investment trust (REIT) that owns, develops, acquires, leases and manages properties primarily in the best business districts (BBDs) of Atlanta, Charlotte, Dallas, Nashville, Orlando, Raleigh, Richmond and Tampa. Highwoods is in the work-placemaking business. We believe that by creating environments and experiences where the best and brightest can achieve together what they cannot apart, we can deliver greater value to our customers, their teammates and, in turn, our stakeholders.

About NETSTREIT

NETSTREIT Corp. is an internally managed real estate investment trust (REIT) based in Dallas, Texas that specializes in acquiring single-tenant net lease retail properties nationwide. The growing portfolio consists of high-quality properties leased to e-commerce resistant tenants with healthy balance sheets. Led by a management team of seasoned commercial real estate executives, NETSTREIT's strategy is to create the highest quality net lease retail portfolio in the country with the goal of generating consistent cash flows and dividends for its investors.