Reviewing Federal Realty Investment Trust (NYSE:FRT) & SBA Communications (NASDAQ:SBAC)

SBA Communications (NASDAQ:SBACGet Free Report) and Federal Realty Investment Trust (NYSE:FRTGet Free Report) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, profitability, risk, valuation, earnings, institutional ownership and dividends.

Volatility & Risk

SBA Communications has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, Federal Realty Investment Trust has a beta of 1.23, suggesting that its stock price is 23% more volatile than the S&P 500.

Profitability

This table compares SBA Communications and Federal Realty Investment Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SBA Communications 18.20% -9.53% 4.71%
Federal Realty Investment Trust 25.76% 10.18% 3.49%

Institutional and Insider Ownership

92.5% of SBA Communications shares are owned by institutional investors. Comparatively, 87.9% of Federal Realty Investment Trust shares are owned by institutional investors. 1.6% of SBA Communications shares are owned by insiders. Comparatively, 1.0% of Federal Realty Investment Trust shares are owned 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.

Analyst Recommendations

This is a summary of current ratings and recommmendations for SBA Communications and Federal Realty Investment Trust, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SBA Communications 0 1 12 1 3.00
Federal Realty Investment Trust 0 3 6 0 2.67

SBA Communications presently has a consensus price target of $279.31, suggesting a potential upside of 29.52%. Federal Realty Investment Trust has a consensus price target of $111.67, suggesting a potential upside of 10.87%. Given SBA Communications’ stronger consensus rating and higher possible upside, equities research analysts clearly believe SBA Communications is more favorable than Federal Realty Investment Trust.

Earnings and Valuation

This table compares SBA Communications and Federal Realty Investment Trust’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
SBA Communications $2.63 billion 8.83 $461.43 million $4.54 47.50
Federal Realty Investment Trust $1.07 billion 7.64 $385.49 million $3.44 29.28

SBA Communications has higher revenue and earnings than Federal Realty Investment Trust. Federal Realty Investment Trust is trading at a lower price-to-earnings ratio than SBA Communications, indicating that it is currently the more affordable of the two stocks.

Dividends

SBA Communications pays an annual dividend of $3.40 per share and has a dividend yield of 1.6%. Federal Realty Investment Trust pays an annual dividend of $4.36 per share and has a dividend yield of 4.3%. SBA Communications pays out 74.9% of its earnings in the form of a dividend. Federal Realty Investment Trust pays out 126.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. SBA Communications has increased its dividend for 4 consecutive years and Federal Realty Investment Trust has increased its dividend for 57 consecutive years. Federal Realty Investment Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

SBA Communications beats Federal Realty Investment Trust on 13 of the 18 factors compared between the two stocks.

About SBA Communications

(Get Free Report)

SBA Communications Corporation is a leading independent owner and operator of wireless communications infrastructure including towers, buildings, rooftops, distributed antenna systems (DAS) and small cells. With a portfolio of more than 39,000 communications sites in 16 markets throughout the Americas, Africa and the Philippines, SBA is listed on NASDAQ under the symbol SBAC. Our organization is part of the S&P 500 and is one of the top Real Estate Investment Trusts (REITs) by market capitalization.

About Federal Realty Investment Trust

(Get Free Report)

Federal Realty is a recognized leader in the ownership, operation and redevelopment of high-quality retail-based properties located primarily in major coastal markets from Washington, D.C. to Boston as well as San Francisco and Los Angeles. Founded in 1962, Federal Realty's mission is to deliver long-term, sustainable growth through investing in communities where retail demand exceeds supply. Its expertise includes creating urban, mixed-use neighborhoods like Santana Row in San Jose, California, Pike & Rose in North Bethesda, Maryland and Assembly Row in Somerville, Massachusetts. These unique and vibrant environments that combine shopping, dining, living and working provide a destination experience valued by their respective communities. Federal Realty's 102 properties include approximately 3,300 tenants, in 26 million square feet, and approximately 3,100 residential units. Federal Realty has increased its quarterly dividends to its shareholders for 56 consecutive years, the longest record in the REIT industry. Federal Realty is an S&P 500 index member and its shares are traded on the NYSE under the symbol FRT.

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