Service Properties Trust (NASDAQ:SVC) vs. Simon Property Group (NYSE:SPG) Head-To-Head Review

Service Properties Trust (NASDAQ:SVC) and Simon Property Group (NYSE:SPG) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, risk, valuation, earnings and dividends.

Earnings & Valuation

This table compares Service Properties Trust and Simon Property Group”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Service Properties Trust	$1.87 billion	0.25	-$32.78 million	($1.47)	-1.89
Simon Property Group	$5.66 billion	10.59	$2.28 billion	$7.51	24.45

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

Dividends

Service Properties Trust pays an annual dividend of $0.04 per share and has a dividend yield of 1.4%. Simon Property Group pays an annual dividend of $8.20 per share and has a dividend yield of 4.5%. Service Properties Trust pays out -2.7% of its earnings in the form of a dividend. Simon Property Group pays out 109.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares Service Properties Trust and Simon Property Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Service Properties Trust	-12.87%	-22.67%	-3.37%
Simon Property Group	43.36%	76.21%	7.61%

Risk & Volatility

Service Properties Trust has a beta of 2.23, meaning that its stock price is 123% more volatile than the S&P 500. Comparatively, Simon Property Group has a beta of 1.74, meaning that its stock price is 74% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Service Properties Trust and Simon Property Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Service Properties Trust	1	0	1	0	2.00
Simon Property Group	0	6	3	0	2.33

Service Properties Trust currently has a consensus price target of $5.50, indicating a potential upside of 97.84%. Simon Property Group has a consensus price target of $162.78, indicating a potential downside of 11.34%. Given Service Properties Trust’s higher possible upside, analysts clearly believe Service Properties Trust is more favorable than Simon Property Group.

Insider & Institutional Ownership

77.6% of Service Properties Trust shares are held by institutional investors. Comparatively, 93.0% of Simon Property Group shares are held by institutional investors. 1.4% of Service Properties Trust shares are held by insiders. Comparatively, 8.5% of Simon Property Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Simon Property Group beats Service Properties Trust on 12 of the 15 factors compared between the two stocks.

About Service Properties Trust

Service Properties Trust (Nasdaq: SVC) is a real estate investment trust with over $11 billion invested in two asset categories: hotels and service-focused retail net lease properties. As of December 31, 2023, SVC owned 221 hotels with over 37,000 guest rooms throughout the United States and in Puerto Rico and Canada, the majority of which are extended stay and select service. As of December 31, 2023, SVC also owned 752 service-focused retail net lease properties totaling approximately 13.3 million square feet throughout the United States. SVC is managed by The RMR Group (Nasdaq: RMR), a leading U.S. alternative asset management company with over $41 billion in assets under management as of December 31, 2023, and more than 35 years of institutional experience in buying, selling, financing and operating commercial real estate. SVC is headquartered in Newton, MA.

About Simon Property Group

Simon Property Group, Inc. (NYSE:SPG) is a self-administered and self-managed real estate investment trust (REIT). Simon Property Group, L.P., or the Operating Partnership, is our majority-owned partnership subsidiary that owns all of our real estate properties and other assets. In this package, the terms Simon, we, our, or the Company refer to Simon Property Group, Inc., the Operating Partnership, and its subsidiaries. We own, develop and manage premier shopping, dining, entertainment and mixed-use destinations, which consist primarily of malls, Premium Outlets, The Mills, and International Properties. At June 30, 2024, we owned or had an interest in 230 properties comprising 183 million square feet in North America, Asia and Europe. We also owned an 84% interest in The Taubman Realty Group, or TRG, which owns 22 regional, super-regional, and outlet malls in the U.S. and Asia. Additionally, at June 30, 2024, we had a 22.4% ownership interest in Klépierre, a publicly traded, Paris-based real estate company, which owns shopping centers in 14 European countries.