Analyzing Sabra Healthcare REIT (NASDAQ:SBRA) and Postal Realty Trust (NYSE:PSTL)

Postal Realty Trust (NYSE:PSTL) and Sabra Healthcare REIT (NASDAQ:SBRA) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, dividends, profitability, valuation and risk.

Dividends

Postal Realty Trust pays an annual dividend of $0.98 per share and has a dividend yield of 5.3%. Sabra Healthcare REIT pays an annual dividend of $1.20 per share and has a dividend yield of 6.2%. Postal Realty Trust pays out 213.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sabra Healthcare REIT pays out 187.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Postal Realty Trust has raised its dividend for 3 consecutive years. Sabra Healthcare REIT is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

57.9% of Postal Realty Trust shares are held by institutional investors. Comparatively, 99.4% of Sabra Healthcare REIT shares are held by institutional investors. 13.2% of Postal Realty Trust shares are held by insiders. Comparatively, 1.1% of Sabra Healthcare REIT shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Risk & Volatility

Postal Realty Trust has a beta of 0.71, suggesting that its share price is 29% less volatile than the S&P 500. Comparatively, Sabra Healthcare REIT has a beta of 0.64, suggesting that its share price is 36% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Postal Realty Trust and Sabra Healthcare REIT, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Postal Realty Trust	0	2	4	0	2.67
Sabra Healthcare REIT	0	5	4	1	2.60

Postal Realty Trust currently has a consensus price target of $20.44, indicating a potential upside of 11.50%. Sabra Healthcare REIT has a consensus price target of $22.00, indicating a potential upside of 13.17%. Given Sabra Healthcare REIT’s higher possible upside, analysts clearly believe Sabra Healthcare REIT is more favorable than Postal Realty Trust.

Valuation & Earnings

This table compares Postal Realty Trust and Sabra Healthcare REIT”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Postal Realty Trust	$95.82 million	5.25	$14.15 million	$0.46	39.85
Sabra Healthcare REIT	$774.63 million	6.33	$155.61 million	$0.64	30.38

Sabra Healthcare REIT has higher revenue and earnings than Postal Realty Trust. Sabra Healthcare REIT is trading at a lower price-to-earnings ratio than Postal Realty Trust, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Postal Realty Trust and Sabra Healthcare REIT’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Postal Realty Trust	14.77%	4.20%	1.99%
Sabra Healthcare REIT	20.09%	5.63%	2.88%

Summary

Sabra Healthcare REIT beats Postal Realty Trust on 12 of the 17 factors compared between the two stocks.

About Postal Realty Trust

Postal Realty Trust, Inc. (NYSE: PSTL) is an internally managed real estate investment trust that owns properties primarily leased to the United States Postal Service ("USPS"). PSTL is focused on acquiring the network of USPS properties, which provide a critical element of the nation's logistics infrastructure that facilitates cost effective and efficient last-mile delivery solutions. As of December 31, 2023, PSTL owned 1,509 properties (including two properties accounted for as financing leases) located in 49 states and one territory comprising approximately 5.9 million net leasable interior square feet. Subsequent to quarter-end and through February 23, 2024, PSTL closed on eight additional properties comprising approximately 33,000 net leasable interior square feet.

About Sabra Healthcare REIT

Sabra Health Care REIT, Inc. engages in the business of acquiring, financing, and owning real estate property. The company was founded on May 10, 2010 and is headquartered in Tustin, CA.