Critical Contrast: American Assets Trust (NYSE:AAT) and National Health Investors (NYSE:NHI)

American Assets Trust (NYSE:AAT) and National Health Investors (NYSE:NHI) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, dividends, valuation, risk, analyst recommendations, earnings and profitability.

Analyst Ratings

This is a summary of recent ratings for American Assets Trust and National Health Investors, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
American Assets Trust	0	2	0	0	2.00
National Health Investors	0	2	2	0	2.50

American Assets Trust currently has a consensus target price of $23.00, suggesting a potential upside of 14.46%. National Health Investors has a consensus target price of $79.00, suggesting a potential upside of 5.22%. Given American Assets Trust’s higher possible upside, analysts plainly believe American Assets Trust is more favorable than National Health Investors.

Valuation and Earnings

This table compares American Assets Trust and National Health Investors”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
American Assets Trust	$457.85 million	2.68	$72.82 million	$0.89	22.58
National Health Investors	$335.18 million	10.23	$135.65 million	$3.12	24.06

National Health Investors has lower revenue, but higher earnings than American Assets Trust. American Assets Trust is trading at a lower price-to-earnings ratio than National Health Investors, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

90.4% of American Assets Trust shares are owned by institutional investors. Comparatively, 62.5% of National Health Investors shares are owned by institutional investors. 37.3% of American Assets Trust shares are owned by company insiders. Comparatively, 7.3% of National Health Investors shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares American Assets Trust and National Health Investors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
American Assets Trust	12.40%	4.98%	1.80%
National Health Investors	38.53%	10.11%	5.12%

Risk and Volatility

American Assets Trust has a beta of 1.33, suggesting that its stock price is 33% more volatile than the S&P 500. Comparatively, National Health Investors has a beta of 1.08, suggesting that its stock price is 8% more volatile than the S&P 500.

Dividends

American Assets Trust pays an annual dividend of $1.36 per share and has a dividend yield of 6.8%. National Health Investors pays an annual dividend of $3.60 per share and has a dividend yield of 4.8%. American Assets Trust pays out 152.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. National Health Investors pays out 115.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

National Health Investors beats American Assets Trust on 10 of the 16 factors compared between the two stocks.

About American Assets Trust

American Assets Trust, Inc. is a full service, vertically integrated and self-administered real estate investment trust ("REIT"), headquartered in San Diego, California. The company has over 55 years of experience in acquiring, improving, developing and managing premier office, retail, and residential properties throughout the United States in some of the nation's most dynamic, high-barrier-to-entry markets primarily in Southern California, Northern California, Washington, Oregon, Texas and Hawaii. The company's office portfolio comprises approximately 4.1 million rentable square feet, and its retail portfolio comprises approximately 3.1 million rentable square feet. In addition, the company owns one mixed-use property (including approximately 94,000 rentable square feet of retail space and a 369-room all-suite hotel) and 2,110 multifamily units. In 2011, the company was formed to succeed to the real estate business of American Assets, Inc., a privately held corporation founded in 1967 and, as such, has significant experience, long-standing relationships and extensive knowledge of its core markets, submarkets and asset classes.

About National Health Investors

Incorporated in 1991, National Health Investors, Inc. (NYSE:NHI) is a real estate investment trust specializing in sale, leasebacks, joint-ventures, senior housing operating partnerships, and mortgage and mezzanine financing of need-driven and discretionary senior housing and medical investments. NHI's portfolio consists of independent living, assisted living and memory care communities, entrance-fee retirement communities, skilled nursing facilities, and specialty hospitals.