Head to Head Analysis: Starwood Property Trust (NYSE:STWD) and Summit Industrial Income REIT (OTCMKTS:SMMCF)

Starwood Property Trust (NYSE:STWD) and Summit Industrial Income REIT (OTCMKTS:SMMCF) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, valuation, earnings, profitability, analyst recommendations, dividends and institutional ownership.

Insider and Institutional Ownership

49.8% of Starwood Property Trust shares are held by institutional investors. Comparatively, 0.1% of Summit Industrial Income REIT shares are held by institutional investors. 5.4% of Starwood Property Trust 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.

Profitability

This table compares Starwood Property Trust and Summit Industrial Income REIT’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Starwood Property Trust	18.82%	9.93%	1.00%
Summit Industrial Income REIT	N/A	N/A	N/A

Valuation and Earnings

This table compares Starwood Property Trust and Summit Industrial Income REIT”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Starwood Property Trust	$1.06 billion	6.36	$339.21 million	$1.17	17.03
Summit Industrial Income REIT	N/A	N/A	N/A	$0.59	29.50

Starwood Property Trust has higher revenue and earnings than Summit Industrial Income REIT. Starwood Property Trust is trading at a lower price-to-earnings ratio than Summit Industrial Income REIT, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Starwood Property Trust and Summit Industrial Income REIT, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Starwood Property Trust	0	3	5	1	2.78
Summit Industrial Income REIT	0	0	0	0	0.00

Starwood Property Trust presently has a consensus target price of $22.13, indicating a potential upside of 11.04%. Given Starwood Property Trust’s stronger consensus rating and higher possible upside, analysts clearly believe Starwood Property Trust is more favorable than Summit Industrial Income REIT.

Dividends

Starwood Property Trust pays an annual dividend of $1.92 per share and has a dividend yield of 9.6%. Summit Industrial Income REIT pays an annual dividend of $0.21 per share and has a dividend yield of 1.2%. Starwood Property Trust pays out 164.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Summit Industrial Income REIT pays out 35.9% of its earnings in the form of a dividend.

Summary

Starwood Property Trust beats Summit Industrial Income REIT on 12 of the 14 factors compared between the two stocks.

About Starwood Property Trust

Starwood Property Trust, Inc. operates as a real estate investment trust (REIT) in the United States and internationally. The company operates through Commercial and Residential Lending, Infrastructure Lending, Property, and Investing and Servicing segments. The Commercial and Residential Lending segment originates, acquires, finances, and manages commercial first mortgages, non-agency residential mortgages, subordinated mortgages, mezzanine loans, preferred equity, commercial mortgage-backed securities (CMBS), and residential mortgage-backed securities, as well as other real estate and real estate-related debt investments, include distressed or non-performing loans. The Infrastructure lending segment originates, acquires, finances, and manages infrastructure debt investments. The Property segment engages primarily in acquiring and managing equity interests in stabilized commercial real estate properties, such as multifamily properties and commercial properties subject to net leases, that are held for investment. The Investing and Servicing segment manages and works out problem assets; acquires and manages unrated, investment grade, and non-investment grade rated CMBS comprising subordinated interests of securitization and re-securitization transactions; originates conduit loans for the primary purpose of selling these loans into securitization transactions; and acquires commercial real estate assets that include properties acquired from CMBS trusts. The company qualifies as a REIT for federal income tax purposes and 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 incorporated in 2009 and is headquartered in Greenwich, Connecticut.

About Summit Industrial Income REIT

Summit Industrial Income REIT is an open-ended mutual fund trust, which engages in growing and managing a portfolio of light industrial properties. Its properties are located in Ontario, Quebec, Alberta, British Columbia, and New Brunswick. The company was founded on November 24, 1998 and is headquartered in Markham, Canada.