Critical Comparison: W. P. Carey (NYSE:WPC) versus Phillips Edison & Company, Inc. (NASDAQ:PECO)

Phillips Edison & Company, Inc. (NASDAQ:PECO) and W. P. Carey (NYSE:WPC) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, dividends, risk, profitability, institutional ownership and earnings.

Profitability

This table compares Phillips Edison & Company, Inc. and W. P. Carey’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Phillips Edison & Company, Inc.	9.48%	2.40%	1.27%
W. P. Carey	29.11%	5.37%	2.61%

Institutional & Insider Ownership

80.7% of Phillips Edison & Company, Inc. shares are held by institutional investors. Comparatively, 73.7% of W. P. Carey shares are held by institutional investors. 8.0% of Phillips Edison & Company, Inc. shares are held by company insiders. Comparatively, 1.1% of W. P. Carey shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Phillips Edison & Company, Inc. and W. P. Carey”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Phillips Edison & Company, Inc.	$661.39 million	6.84	$62.69 million	$0.50	72.24
W. P. Carey	$1.58 billion	8.79	$460.84 million	$2.09	30.43

W. P. Carey has higher revenue and earnings than Phillips Edison & Company, Inc.. W. P. Carey is trading at a lower price-to-earnings ratio than Phillips Edison & Company, Inc., indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Phillips Edison & Company, Inc. has a beta of 0.58, meaning that its stock price is 42% less volatile than the S&P 500. Comparatively, W. P. Carey has a beta of 0.97, meaning that its stock price is 3% less volatile than the S&P 500.

Dividends

Phillips Edison & Company, Inc. pays an annual dividend of $1.23 per share and has a dividend yield of 3.4%. W. P. Carey pays an annual dividend of $3.52 per share and has a dividend yield of 5.5%. Phillips Edison & Company, Inc. pays out 246.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. W. P. Carey pays out 168.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. W. P. Carey is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Phillips Edison & Company, Inc. and W. P. Carey, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Phillips Edison & Company, Inc.	0	3	3	0	2.50
W. P. Carey	1	5	3	0	2.22

Phillips Edison & Company, Inc. currently has a consensus price target of $39.00, suggesting a potential upside of 7.97%. W. P. Carey has a consensus price target of $62.88, suggesting a potential downside of 1.15%. Given Phillips Edison & Company, Inc.’s stronger consensus rating and higher possible upside, equities analysts plainly believe Phillips Edison & Company, Inc. is more favorable than W. P. Carey.

Summary

W. P. Carey beats Phillips Edison & Company, Inc. on 10 of the 15 factors compared between the two stocks.

About Phillips Edison & Company, Inc.

Phillips Edison & Co., Inc. is a real estate investment trust, which engages in the ownership and operation of shopping centers. It also offers an investment management business providing property management and advisory services. Its portfolio consists of well-occupied, grocery-anchored neighborhood and community shopping centers having a mix of national, regional, and local retailers offering necessity-based goods and services. The company was founded by Jeffrey S. Edison and Michael C. Phillips in 1991 and is headquartered in Cincinnati, OH.

About W. P. Carey

W. P. Carey ranks among the largest net lease REITs with a well-diversified portfolio of high-quality, operationally critical commercial real estate, which includes 1,424 net lease properties covering approximately 173 million square feet and a portfolio of 89 self-storage operating properties as of December 31, 2023. With offices in New York, London, Amsterdam and Dallas, the company remains focused on investing primarily in single-tenant, industrial, warehouse and retail properties located in the U.S. and Northern and Western Europe, under long-term net leases with built-in rent escalations.