Financial Comparison: China Evergrande Group (OTCMKTS:EGRNF) & Greentown China (OTCMKTS:GTWCF)

China Evergrande Group (OTCMKTS:EGRNF) and Greentown China (OTCMKTS:GTWCF) are both real estate companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, analyst recommendations, institutional ownership, risk and valuation.

Analyst Recommendations

This is a summary of recent ratings and target prices for China Evergrande Group and Greentown China, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
China Evergrande Group	0	0	0	0	0.00
Greentown China	0	0	1	0	3.00

Given China Evergrande Group’s higher possible upside, analysts plainly believe China Evergrande Group is more favorable than Greentown China.

Valuation and Earnings

This table compares China Evergrande Group and Greentown China”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
China Evergrande Group	N/A	N/A	N/A	$0.87	N/A
Greentown China	N/A	N/A	N/A	$1.55	0.62

China Evergrande Group is trading at a lower price-to-earnings ratio than Greentown China, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

8.2% of China Evergrande Group shares are owned by institutional investors. Comparatively, 5.9% of Greentown China shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Dividends

China Evergrande Group pays an annual dividend of $0.57 per share. Greentown China pays an annual dividend of $0.43 per share and has a dividend yield of 45.1%. China Evergrande Group pays out 65.7% of its earnings in the form of a dividend. Greentown China pays out 27.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Greentown China is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares China Evergrande Group and Greentown China’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
China Evergrande Group	N/A	N/A	N/A
Greentown China	N/A	N/A	N/A

Summary

Greentown China beats China Evergrande Group on 5 of the 8 factors compared between the two stocks.

About China Evergrande Group

China Evergrande Group, an investment holding company, primarily engages in the property development business in the People’s Republic of China. It operates through Property Development, Property Investment, Property Management Services, and Other Businesses segments. The company offers property development, investment, and management services; and engages in new energy vehicle, cultural tourism, and health industry business. It also provides sale and manufacturing of smart mobility; and development and sale of health and living projects, as well as develops and operates real estate. The company was incorporated in 2006 and is headquartered in Guangzhou, the People’s Republic of China. China Evergrande Group operates as a subsidiary of Xin Xin (BVI) Limited.

About Greentown China

Greentown China Holdings Limited, an investment holding company, engages in the property development and related business in China. It operates through Property Development, Hotel Operations, Property Investment, Project Management, and Other segments. The company develops and sells residential properties. It also offers investment and asset management; project management; technology research and development; and design and decoration services. In addition, the company constructs, develops, and operates education projects; operates hotels and clubs; and invests in and rents properties, as well as sells construction materials. The company was founded in 1995 and is headquartered in Hangzhou, the People's Republic of China.