Critical Review: BrightSpire Capital (NYSE:BRSP) versus Brixmor Property Group (NYSE:BRX)

BrightSpire Capital (NYSE:BRSP) and Brixmor Property Group (NYSE:BRX) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, analyst recommendations, profitability, institutional ownership, valuation, risk and dividends.

Insider and Institutional Ownership

56.6% of BrightSpire Capital shares are held by institutional investors. Comparatively, 98.4% of Brixmor Property Group shares are held by institutional investors. 1.9% of BrightSpire Capital shares are held by company insiders. Comparatively, 0.8% of Brixmor Property Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Risk and Volatility

BrightSpire Capital has a beta of 1.88, indicating that its share price is 88% more volatile than the S&P 500. Comparatively, Brixmor Property Group has a beta of 1.58, indicating that its share price is 58% more volatile than the S&P 500.

Dividends

BrightSpire Capital pays an annual dividend of $0.64 per share and has a dividend yield of 11.2%. Brixmor Property Group pays an annual dividend of $1.15 per share and has a dividend yield of 4.3%. BrightSpire Capital pays out -62.7% of its earnings in the form of a dividend. Brixmor Property Group pays out 106.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. BrightSpire Capital is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for BrightSpire Capital and Brixmor Property Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BrightSpire Capital	1	3	3	0	2.29
Brixmor Property Group	0	4	8	0	2.67

BrightSpire Capital currently has a consensus price target of $7.45, suggesting a potential upside of 30.47%. Brixmor Property Group has a consensus price target of $30.38, suggesting a potential upside of 13.72%. Given BrightSpire Capital’s higher probable upside, research analysts plainly believe BrightSpire Capital is more favorable than Brixmor Property Group.

Earnings and Valuation

This table compares BrightSpire Capital and Brixmor Property Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BrightSpire Capital	$298.70 million	2.48	-$15.55 million	($1.02)	-5.60
Brixmor Property Group	$1.25 billion	6.48	$305.09 million	$1.08	24.73

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

Profitability

This table compares BrightSpire Capital and Brixmor Property Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BrightSpire Capital	-69.35%	9.44%	2.79%
Brixmor Property Group	25.81%	11.48%	3.81%

Summary

Brixmor Property Group beats BrightSpire Capital on 10 of the 15 factors compared between the two stocks.

About BrightSpire Capital

BrightSpire Capital, Inc. operates as a commercial real estate (CRE) credit real estate investment trust in the United States and Europe. The company operates through Senior and Mezzanine Loans and Preferred Equity; Net Leased and Other Real Estate; and Corporate and Other segments. It focuses on originating, acquiring, financing, and managing a diversified portfolio of CRE debt investments consisting of first mortgage loans, senior loans, debt securities, mezzanine loans, and preferred equity investments, as well as net leased properties. 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 Colony Credit Real Estate, Inc. and changed its name to BrightSpire Capital, Inc. in June 2021. BrightSpire Capital, Inc. was incorporated in 2017 and is headquartered in New York, New York.

About Brixmor Property Group

Brixmor Property Group, Inc. operates as a real estate investment trust, which engages in owning and operating a portfolio of grocery anchored community and neighborhood shopping centers. The company was founded in 1985 and is headquartered in New York, NY.