Head-To-Head Analysis: Peakstone Realty Trust (NYSE:PKST) versus Invesco Mortgage Capital (NYSE:IVR)

Peakstone Realty Trust (NYSE:PKST) and Invesco Mortgage Capital (NYSE:IVR) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, earnings, valuation, profitability and dividends.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Peakstone Realty Trust and Invesco Mortgage Capital, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Peakstone Realty Trust	0	1	0	1	3.00
Invesco Mortgage Capital	0	1	1	0	2.50

Peakstone Realty Trust currently has a consensus target price of $15.00, indicating a potential upside of 24.20%. Invesco Mortgage Capital has a consensus target price of $10.00, indicating a potential upside of 37.08%. Given Invesco Mortgage Capital’s higher possible upside, analysts clearly believe Invesco Mortgage Capital is more favorable than Peakstone Realty Trust.

Volatility and Risk

Peakstone Realty Trust has a beta of 1.69, indicating that its stock price is 69% more volatile than the S&P 500. Comparatively, Invesco Mortgage Capital has a beta of 1.43, indicating that its stock price is 43% more volatile than the S&P 500.

Valuation and Earnings

This table compares Peakstone Realty Trust and Invesco Mortgage Capital”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Peakstone Realty Trust	$228.07 million	1.95	-$550.58 million	($0.28)	-43.13
Invesco Mortgage Capital	$79.55 million	5.99	-$15.86 million	$0.65	11.22

Invesco Mortgage Capital has lower revenue, but higher earnings than Peakstone Realty Trust. Peakstone Realty Trust is trading at a lower price-to-earnings ratio than Invesco Mortgage Capital, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

39.0% of Peakstone Realty Trust shares are held by institutional investors. Comparatively, 40.5% of Invesco Mortgage Capital shares are held by institutional investors. 0.5% of Peakstone Realty Trust shares are held by company insiders. Comparatively, 0.2% of Invesco Mortgage Capital 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.

Dividends

Peakstone Realty Trust pays an annual dividend of $0.90 per share and has a dividend yield of 7.5%. Invesco Mortgage Capital pays an annual dividend of $1.36 per share and has a dividend yield of 18.6%. Peakstone Realty Trust pays out -321.4% of its earnings in the form of a dividend. Invesco Mortgage Capital pays out 209.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares Peakstone Realty Trust and Invesco Mortgage Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Peakstone Realty Trust	-4.38%	-0.85%	-0.38%
Invesco Mortgage Capital	20.90%	34.61%	3.29%

Summary

Invesco Mortgage Capital beats Peakstone Realty Trust on 11 of the 17 factors compared between the two stocks.

About Peakstone Realty Trust

Peakstone Realty Trust (NYSE: PKST) is an internally managed, real estate investment trust (REIT) that owns and operates a high-quality, newer-vintage portfolio of predominantly single-tenant industrial and office properties. These assets are generally leased to creditworthy tenants under long-term net lease agreements with contractual rent escalations. As of March 31, 2023, Peakstone's wholly-owned portfolio consists of 19 million square feet across 24 states in primarily high-growth, strategic coastal and sunbelt markets.

About Invesco Mortgage Capital

Invesco Mortgage Capital Inc. operates as a real estate investment trust (REIT) that invests, finances, and manages mortgage-backed securities and other mortgage-related assets in the United States. It invests in residential mortgage-backed securities (RMBS) and commercial mortgage-backed securities (CMBS) that are guaranteed by a U.S. government agency or federally chartered corporation; RMBS and CMBS that are not issued or guaranteed by the United States government agency or federally chartered corporation; the United States treasury securities; real estate-related financing arrangements; to-be-announced securities forward contracts to purchase RMBS; and commercial mortgage loans. It has elected to be taxed as a REIT and would be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was incorporated in 2008 and is headquartered in Atlanta, Georgia.