Welltower (NYSE:WELL) and Empire State Realty Trust (NYSE:ESRT) Critical Contrast

Welltower (NYSE:WELL) and Empire State Realty Trust (NYSE:ESRT) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, valuation, risk, earnings, analyst recommendations, dividends and institutional ownership.

Dividends

Welltower pays an annual dividend of $2.68 per share and has a dividend yield of 1.8%. Empire State Realty Trust pays an annual dividend of $0.14 per share and has a dividend yield of 1.7%. Welltower pays out 171.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Empire State Realty Trust pays out 50.0% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Welltower and Empire State Realty Trust, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Welltower	0	2	10	2	3.00
Empire State Realty Trust	1	0	1	0	2.00

Welltower currently has a consensus target price of $150.19, indicating a potential upside of 2.04%. Empire State Realty Trust has a consensus target price of $11.50, indicating a potential upside of 39.48%. Given Empire State Realty Trust’s higher possible upside, analysts clearly believe Empire State Realty Trust is more favorable than Welltower.

Profitability

This table compares Welltower and Empire State Realty Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Welltower	11.91%	3.15%	2.00%
Empire State Realty Trust	6.45%	2.84%	1.14%

Volatility and Risk

Welltower has a beta of 1.2, meaning that its share price is 20% more volatile than the S&P 500. Comparatively, Empire State Realty Trust has a beta of 1.39, meaning that its share price is 39% more volatile than the S&P 500.

Earnings & Valuation

This table compares Welltower and Empire State Realty Trust”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Welltower	$7.85 billion	12.02	$951.68 million	$1.56	94.35
Empire State Realty Trust	$767.92 million	1.80	$53.24 million	$0.28	29.45

Welltower has higher revenue and earnings than Empire State Realty Trust. Empire State Realty Trust is trading at a lower price-to-earnings ratio than Welltower, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

94.8% of Welltower shares are held by institutional investors. Comparatively, 67.1% of Empire State Realty Trust shares are held by institutional investors. 0.1% of Welltower shares are held by company insiders. Comparatively, 14.0% of Empire State Realty Trust shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Welltower beats Empire State Realty Trust on 13 of the 17 factors compared between the two stocks.

About Welltower

Welltower Inc. (NYSE:WELL), a real estate investment trust (“REIT”) and S&P 500 company headquartered in Toledo, Ohio, is driving the transformation of health care infrastructure. Welltower invests with leading seniors housing operators, post-acute providers and health systems to fund the real estate infrastructure needed to scale innovative care delivery models and improve people’s wellness and overall health care experience. Welltower owns interests in properties concentrated in major, high-growth markets in the United States, Canada and the United Kingdom, consisting of seniors housing and post-acute communities and outpatient medical properties.

About Empire State Realty Trust

Empire State Realty Trust, Inc. (NYSE: ESRT) is a NYC-focused REIT that owns and operates a portfolio of modernized, amenitized, and well-located office, retail, and multifamily assets. The company is the recognized leader in energy efficiency and indoor environmental quality. ESRT’s flagship Empire State Building – the “World’s Most Famous Building” – includes its Observatory, Tripadvisor’s 2023 Travelers’ Choice Awards: Best of the Best the #1 attraction in the US for two consecutive years. As of September 30, 2023, ESRT’s portfolio is comprised of approximately 8.6 million rentable square feet of office space, 0.7 million rentable square feet of retail space and 727 residential units across three multifamily properties.