Comparing Government Properties Income Trust (GOV) & Brookfield Canada Office Properties (BOXC)

Government Properties Income Trust (NASDAQ: GOV) and Brookfield Canada Office Properties (NYSE:BOXC) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, dividends, valuation, profitability, institutional ownership, earnings and analyst recommendations.

Risk and Volatility

Government Properties Income Trust has a beta of 1.05, indicating that its stock price is 5% more volatile than the S&P 500. Comparatively, Brookfield Canada Office Properties has a beta of 1.04, indicating that its stock price is 4% more volatile than the S&P 500.

Earnings and Valuation

This table compares Government Properties Income Trust and Brookfield Canada Office Properties’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Government Properties Income Trust $258.18 million 7.12 $57.84 million $0.54 34.33
Brookfield Canada Office Properties N/A N/A N/A $1.16 21.52

Government Properties Income Trust has higher revenue and earnings than Brookfield Canada Office Properties. Brookfield Canada Office Properties is trading at a lower price-to-earnings ratio than Government Properties Income Trust, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

58.2% of Government Properties Income Trust shares are owned by institutional investors. Comparatively, 20.1% of Brookfield Canada Office Properties shares are owned by institutional investors. 2.7% of Government Properties Income Trust shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Government Properties Income Trust and Brookfield Canada Office Properties’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Government Properties Income Trust 15.30% 4.27% 1.66%
Brookfield Canada Office Properties 7.64% 1.26% 0.65%

Dividends

Government Properties Income Trust pays an annual dividend of $1.72 per share and has a dividend yield of 9.3%. Brookfield Canada Office Properties pays an annual dividend of $0.97 per share and has a dividend yield of 3.9%. Government Properties Income Trust pays out 318.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Brookfield Canada Office Properties pays out 83.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a breakdown of current ratings and target prices for Government Properties Income Trust and Brookfield Canada Office Properties, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Government Properties Income Trust 2 1 2 0 2.00
Brookfield Canada Office Properties 0 1 0 0 2.00

Government Properties Income Trust currently has a consensus price target of $18.75, suggesting a potential upside of 1.13%. Given Government Properties Income Trust’s higher possible upside, equities analysts clearly believe Government Properties Income Trust is more favorable than Brookfield Canada Office Properties.

Summary

Government Properties Income Trust beats Brookfield Canada Office Properties on 11 of the 13 factors compared between the two stocks.

About Government Properties Income Trust

Government Properties Income Trust is a real estate investment trust (REIT). The Company operates through two segments: ownership of properties that are primarily leased to government tenants and its equity method investment in Select Income REIT (SIR). The Company’s properties are located in areas, including Alabama, Arizona, California, Colorado, District of Columbia, Florida, Georgia, Idaho, Illinois, Indiana, Kansas, Kentucky, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, New Hampshire, New Jersey and New Mexico. As of December 31, 2016, the Company owned 73 properties (95 buildings). As of December 31, 2016, the Company’s properties were located in 31 states and the District of Columbia, and contained approximately 11.4 million rentable square feet.

About Brookfield Canada Office Properties

Brookfield Canada Office Properties is a Canada-based real estate investment trust (REIT). The Company invests, develops and operates commercial office properties in Toronto, Ottawa, Calgary and Vancouver. The Company’s commercial-property portfolio consists of interests in approximately 25 properties totaling approximately 21.1 million square feet, including approximately 4.0 million square feet of parking and other. The Company’s development portfolio consists of the Brookfield Place Calgary East development site totaling approximately 1.4 million square feet in Calgary. The Company also invests in ongoing maintenance and capital improvement projects. The Company focuses on the markets, which include financial, government and energy sectors, which are primarily located in the cities of Toronto and Calgary. Its properties include 2 Queen Street East, Queen’s Quay Terminal, Exchange Tower, Bankers Hall Retail, Suncor Energy Centre, Jean Edmonds Tower and Royal Centre.

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