Critical Comparison: Kite Realty Group Trust (NYSE:KRG) vs. Rithm Capital (NYSE:RITM)

Rithm Capital (NYSE:RITM) and Kite Realty Group Trust (NYSE:KRG) are both mid-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, institutional ownership, valuation, profitability, analyst recommendations, earnings and dividends.

Valuation and Earnings

This table compares Rithm Capital and Kite Realty Group Trust”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rithm Capital	$2.44 billion	2.11	$622.26 million	$1.50	7.11
Kite Realty Group Trust	$827.37 million	6.87	$47.50 million	$0.26	99.54

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

Volatility & Risk

Rithm Capital has a beta of 1.8, suggesting that its stock price is 80% more volatile than the S&P 500. Comparatively, Kite Realty Group Trust has a beta of 1.29, suggesting that its stock price is 29% more volatile than the S&P 500.

Dividends

Rithm Capital pays an annual dividend of $1.00 per share and has a dividend yield of 9.4%. Kite Realty Group Trust pays an annual dividend of $1.04 per share and has a dividend yield of 4.0%. Rithm Capital pays out 66.7% of its earnings in the form of a dividend. Kite Realty Group Trust pays out 400.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Rithm Capital is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Rithm Capital and Kite Realty Group Trust, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rithm Capital	0	1	8	0	2.89
Kite Realty Group Trust	0	2	4	1	2.86

Rithm Capital currently has a consensus target price of $12.67, indicating a potential upside of 18.82%. Kite Realty Group Trust has a consensus target price of $28.00, indicating a potential upside of 8.19%. Given Rithm Capital’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Rithm Capital is more favorable than Kite Realty Group Trust.

Insider & Institutional Ownership

44.9% of Rithm Capital shares are held by institutional investors. Comparatively, 90.8% of Kite Realty Group Trust shares are held by institutional investors. 0.4% of Rithm Capital shares are held by insiders. Comparatively, 2.0% of Kite Realty Group Trust shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Rithm Capital and Kite Realty Group Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rithm Capital	15.55%	18.04%	2.63%
Kite Realty Group Trust	-2.95%	-0.69%	-0.35%

Summary

Rithm Capital beats Kite Realty Group Trust on 12 of the 17 factors compared between the two stocks.

About Rithm Capital

Rithm Capital Corp. operates as an asset manager focused on real estate, credit, and financial services. It operates through Origination and Servicing, Investment Portfolio, Mortgage Loans Receivable, and Asset Management segments. Its investment portfolio primarily comprises of mortgage servicing rights (MSR), and MSR financing receivables, title, appraisal and property preservation, excess MSRs, and services advance investments; real estate securities, call rights, SFR properties, and residential mortgage loans; consumer and business purpose loans; and asset management related investments. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was formerly known as New Residential Investment Corp. and changed its name to Rithm Capital Corp. in August 2022. Rithm Capital Corp. was incorporated in 2011 and is based in New York, New York.

About Kite Realty Group Trust

Kite Realty Group Trust (NYSE: KRG) is a real estate investment trust (REIT) headquartered in Indianapolis, IN that is one of the largest publicly traded owners and operators of open-air shopping centers and mixed-use assets. The Company’s primarily grocery-anchored portfolio is located in high-growth Sun Belt and select strategic gateway markets. The combination of necessity-based grocery-anchored neighborhood and community centers, along with vibrant mixed-use assets makes the KRG portfolio an ideal mix for both retailers and consumers. Publicly listed since 2004, KRG has nearly 60 years of experience in developing, constructing and operating real estate. Using operational, investment, development, and redevelopment expertise, KRG continuously optimizes its portfolio to maximize value and return to shareholders. As of December 31, 2023, the Company owned interests in 180 U.S. open-air shopping centers and mixed-use assets, comprising approximately 28.1 million square feet of gross leasable space.