SBA Communications (NASDAQ:SBAC) and Investors Real Estate Trust Reit (NYSE:IRET) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, valuation, dividends, analyst recommendations and risk.

Profitability

This table compares SBA Communications and Investors Real Estate Trust Reit’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SBA Communications 6.89% -4.16% 1.61%
Investors Real Estate Trust Reit 13.72% 4.66% 1.78%

Institutional & Insider Ownership

93.5% of SBA Communications shares are held by institutional investors. Comparatively, 64.4% of Investors Real Estate Trust Reit shares are held by institutional investors. 2.5% of SBA Communications shares are held by company insiders. Comparatively, 0.5% of Investors Real Estate Trust Reit shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for SBA Communications and Investors Real Estate Trust Reit, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SBA Communications 0 7 4 0 2.36
Investors Real Estate Trust Reit 0 0 6 0 3.00

SBA Communications currently has a consensus price target of $251.18, suggesting a potential downside of 13.32%. Investors Real Estate Trust Reit has a consensus price target of $77.30, suggesting a potential downside of 8.21%. Given Investors Real Estate Trust Reit’s stronger consensus rating and higher possible upside, analysts plainly believe Investors Real Estate Trust Reit is more favorable than SBA Communications.

Dividends

SBA Communications pays an annual dividend of $1.48 per share and has a dividend yield of 0.5%. Investors Real Estate Trust Reit pays an annual dividend of $2.80 per share and has a dividend yield of 3.3%. SBA Communications pays out 19.5% of its earnings in the form of a dividend.

Earnings and Valuation

This table compares SBA Communications and Investors Real Estate Trust Reit’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
SBA Communications $1.87 billion 17.49 $47.45 million $7.60 38.13
Investors Real Estate Trust Reit $169.74 million 5.77 $116.78 million N/A N/A

Investors Real Estate Trust Reit has lower revenue, but higher earnings than SBA Communications.

Risk and Volatility

SBA Communications has a beta of 0.63, meaning that its share price is 37% less volatile than the S&P 500. Comparatively, Investors Real Estate Trust Reit has a beta of 0.84, meaning that its share price is 16% less volatile than the S&P 500.

Summary

Investors Real Estate Trust Reit beats SBA Communications on 10 of the 14 factors compared between the two stocks.

About SBA Communications

SBA Communications Corporation is a first choice provider and leading owner and operator of wireless communications infrastructure in North, Central, and South America. By “Building Better Wireless,” SBA generates revenue from two primary businesses – site leasing and site development services. The primary focus of the Company is the leasing of antenna space on its multi-tenant communication sites to a variety of wireless service providers under long-term lease contracts.

About Investors Real Estate Trust Reit

IRET is a real estate company focused on the ownership, management, acquisition, redevelopment, and development of apartment communities. As of December 31, 2018, IRET owned interests in 87 apartment communities consisting of 13,702 apartment homes. IRET's common shares and Series C preferred shares are publicly traded on the New York Stock Exchange (NYSE symbols: IRET and IRET PRC, respectively).

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