Financial Comparison: Alexandria Real Estate Equities (NYSE:ARE) and Centerspace (NYSE:CSR)

Centerspace (NYSE:CSR) and Alexandria Real Estate Equities (NYSE:ARE) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, valuation, earnings, analyst recommendations and dividends.

Dividends

Centerspace pays an annual dividend of $3.00 per share and has a dividend yield of 4.4%. Alexandria Real Estate Equities pays an annual dividend of $5.08 per share and has a dividend yield of 4.2%. Centerspace pays out -375.0% of its earnings in the form of a dividend. Alexandria Real Estate Equities pays out 474.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Centerspace has raised its dividend for 1 consecutive years and Alexandria Real Estate Equities has raised its dividend for 14 consecutive years. Centerspace is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

Centerspace has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500. Comparatively, Alexandria Real Estate Equities has a beta of 1.07, indicating that its share price is 7% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for Centerspace and Alexandria Real Estate Equities, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Centerspace	0	4	2	0	2.33
Alexandria Real Estate Equities	0	1	7	0	2.88

Centerspace presently has a consensus price target of $66.17, indicating a potential downside of 3.91%. Alexandria Real Estate Equities has a consensus price target of $136.75, indicating a potential upside of 13.48%. Given Alexandria Real Estate Equities’ stronger consensus rating and higher possible upside, analysts plainly believe Alexandria Real Estate Equities is more favorable than Centerspace.

Earnings and Valuation

This table compares Centerspace and Alexandria Real Estate Equities’ gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Centerspace	$261.31 million	3.93	$41.97 million	($0.80)	-86.07
Alexandria Real Estate Equities	$2.95 billion	7.13	$103.64 million	$1.07	112.63

Alexandria Real Estate Equities has higher revenue and earnings than Centerspace. Centerspace is trading at a lower price-to-earnings ratio than Alexandria Real Estate Equities, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Centerspace and Alexandria Real Estate Equities’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Centerspace	-2.38%	-0.73%	-0.32%
Alexandria Real Estate Equities	6.65%	0.87%	0.53%

Insider and Institutional Ownership

79.0% of Centerspace shares are held by institutional investors. Comparatively, 96.5% of Alexandria Real Estate Equities shares are held by institutional investors. 0.9% of Centerspace shares are held by company insiders. Comparatively, 1.2% of Alexandria Real Estate Equities shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Alexandria Real Estate Equities beats Centerspace on 15 of the 17 factors compared between the two stocks.

About Centerspace

Centerspace is an owner and operator of apartment communities committed to providing great homes by focusing on integrity and serving others. Founded in 1970, as of September 30, 2023, Centerspace owned interests in 71 apartment communities consisting of 12,785 apartment homes located in Colorado, Minnesota, Montana, Nebraska, North Dakota, and South Dakota. Centerspace was named a Top Workplace for the fourth consecutive year in 2023 by the Minneapolis Star Tribune.

About Alexandria Real Estate Equities

Alexandria Real Estate Equities, Inc. (NYSE: ARE), an S&P 500 company, is a best-in-class, mission-driven life science REIT making a positive and lasting impact on the world. As the pioneer of the life science real estate niche since our founding in 1994, Alexandria is the preeminent and longest-tenured owner, operator, and developer of collaborative life science, agtech, and advanced technology mega campuses in AAA innovation cluster locations, including Greater Boston, the San Francisco Bay Area, New York City, San Diego, Seattle, Maryland, and Research Triangle. Alexandria has a total market capitalization of $33.1 billion and an asset base in North America of 73.5 million SF as of December 31, 2023, which includes 42.0 million RSF of operating properties, 5.5 million RSF of Class A/A+ properties undergoing construction and one near-term project expected to commence construction in the next two years, 2.1 million RSF of priority anticipated development and redevelopment projects, and 23.9 million SF of future development projects. Alexandria has a longstanding and proven track record of developing Class A/A+ properties clustered in life science, agtech, and advanced technology mega campuses that provide our innovative tenants with highly dynamic and collaborative environments that enhance their ability to successfully recruit and retain world-class talent and inspire productivity, efficiency, creativity, and success. Alexandria also provides strategic capital to transformative life science, agrifoodtech, climate innovation, and technology companies through our venture capital platform. We believe our unique business model and diligent underwriting ensure a high-quality and diverse tenant base that results in higher occupancy levels, longer lease terms, higher rental income, higher returns, and greater long-term asset value.