Analyzing Whitestone REIT (NYSE:WSR) & UDR (NYSE:UDR)

Whitestone REIT (NYSE:WSR) and UDR (NYSE:UDR) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, earnings, dividends, profitability, risk, valuation and analyst recommendations.

Insider and Institutional Ownership

69.5% of Whitestone REIT shares are held by institutional investors. Comparatively, 97.8% of UDR shares are held by institutional investors. 5.5% of Whitestone REIT shares are held by insiders. Comparatively, 3.7% of UDR shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Whitestone REIT	$150.55 million	4.42	$19.18 million	$0.48	27.75
UDR	$1.63 billion	9.14	$444.35 million	$1.38	32.68

UDR has higher revenue and earnings than Whitestone REIT. Whitestone REIT is trading at a lower price-to-earnings ratio than UDR, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Whitestone REIT has a beta of 1.27, indicating that its share price is 27% more volatile than the S&P 500. Comparatively, UDR has a beta of 0.85, indicating that its share price is 15% less volatile than the S&P 500.

Dividends

Whitestone REIT pays an annual dividend of $0.49 per share and has a dividend yield of 3.7%. UDR pays an annual dividend of $1.70 per share and has a dividend yield of 3.8%. Whitestone REIT pays out 102.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. UDR pays out 123.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. UDR has raised its dividend for 14 consecutive years. UDR is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Whitestone REIT and UDR’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Whitestone REIT	10.68%	3.75%	1.42%
UDR	8.34%	3.70%	1.28%

Analyst Recommendations

This is a breakdown of current recommendations for Whitestone REIT and UDR, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Whitestone REIT	0	1	3	0	2.75
UDR	1	9	8	0	2.39

Whitestone REIT presently has a consensus price target of $15.00, suggesting a potential upside of 12.61%. UDR has a consensus price target of $44.28, suggesting a potential downside of 1.82%. Given Whitestone REIT’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Whitestone REIT is more favorable than UDR.

Summary

UDR beats Whitestone REIT on 9 of the 17 factors compared between the two stocks.

About Whitestone REIT

Whitestone REIT (NYSE: WSR) is a community-centered real estate investment trust (REIT) that acquires, owns, operates, and develops open-air, retail centers located in some of the fastest growing markets in the country: Phoenix, Austin, Dallas-Fort Worth, Houston and San Antonio. Our centers are convenience focused: merchandised with a mix of service-oriented tenants providing food (restaurants and grocers), self-care (health and fitness), services (financial and logistics), education and entertainment to the surrounding communities. The Company believes its strong community connections and deep tenant relationships are key to the success of its current centers and its acquisition strategy.

About UDR

UDR, Inc. (NYSE: UDR), an S&P 500 company, is a leading multifamily real estate investment trust with a demonstrated performance history of delivering superior and dependable returns by successfully managing, buying, selling, developing and redeveloping attractive real estate communities in targeted U.S. markets. As of December 31, 2023, UDR owned or had an ownership position in 60,336 apartment homes including 359 homes under development. For over 51 years, UDR has delivered long-term value to shareholders, the best standard of service to Residents and the highest quality experience for Associates.