Contrasting Orion Office REIT (NYSE:ONL) & Highlands REIT (OTCMKTS:HHDS)

Highlands REIT (OTCMKTS:HHDS) and Orion Office REIT (NYSE:ONL) are both small-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, dividends, risk, analyst recommendations, institutional ownership, valuation and earnings.

Insider and Institutional Ownership

0.0% of Highlands REIT shares are owned by institutional investors. Comparatively, 79.9% of Orion Office REIT shares are owned by institutional investors. 3.7% of Highlands REIT shares are owned by insiders. Comparatively, 0.2% of Orion Office REIT shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Highlands REIT and Orion Office REIT, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Highlands REIT	0	0	0	0	0.00
Orion Office REIT	0	1	0	0	2.00

Risk & Volatility

Highlands REIT has a beta of 18.81, suggesting that its stock price is 1,781% more volatile than the S&P 500. Comparatively, Orion Office REIT has a beta of 1.34, suggesting that its stock price is 34% more volatile than the S&P 500.

Valuation & Earnings

This table compares Highlands REIT and Orion Office REIT”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Highlands REIT	$30.98 million	0.57	-$10.30 million	$0.01	2.45
Orion Office REIT	$155.67 million	0.63	-$57.30 million	($1.54)	-1.13

Highlands REIT has higher earnings, but lower revenue than Orion Office REIT. Orion Office REIT is trading at a lower price-to-earnings ratio than Highlands REIT, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Highlands REIT and Orion Office REIT’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Highlands REIT	-11.68%	-1.98%	-1.19%
Orion Office REIT	-50.76%	-10.28%	-6.26%

Summary

Highlands REIT beats Orion Office REIT on 8 of the 12 factors compared between the two stocks.

About Highlands REIT

We are a self-advised and self-administered real estate investment trust (REIT) created to own and manage substantially all of the non-core investment properties previously owned and managed by our former parent, InvenTrust Properties Corp., a Maryland corporation (InvenTrust). On April 28, 2016, we were spun-off from InvenTrust through a pro rata distribution (the Distribution) by InvenTrust of 100% of the outstanding shares of our common stock to holders of InvenTrust's common stock. Prior to or concurrent with the separation, we and InvenTrust engaged in certain reorganization transactions that were designed to consolidate substantially all of InvenTrust's remaining non-core investment properties in Highlands.

About Orion Office REIT

Orion Office REIT specializes in the ownership, acquisition and management of a diversified portfolio of mission-critical and corporate headquarters office buildings in high-quality suburban markets across the U.S. The portfolio is leased primarily on a single-tenant net lease basis to creditworthy tenants. The company's team of experienced industry leaders employs a proven, cycle-tested investment evaluation framework which serves as the lens through which capital allocation decisions are made for the current portfolio and future acquisitions.