Contrasting Equinix (NASDAQ:EQIX) and Great Ajax (NYSE:AJX)

Equinix (NASDAQ:EQIXGet Rating) and Great Ajax (NYSE:AJXGet Rating) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, institutional ownership, valuation, profitability, analyst recommendations, earnings and dividends.

Profitability

This table compares Equinix and Great Ajax’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Equinix 7.54% 6.65% 2.56%
Great Ajax 54.37% 10.30% 2.36%

Valuation & Earnings

This table compares Equinix and Great Ajax’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Equinix $6.64 billion 10.50 $500.19 million $5.54 138.66
Great Ajax $77.95 million 2.94 $41.85 million $1.42 6.98

Equinix has higher revenue and earnings than Great Ajax. Great Ajax is trading at a lower price-to-earnings ratio than Equinix, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Equinix and Great Ajax, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Equinix 0 6 11 1 2.72
Great Ajax 0 1 3 0 2.75

Equinix currently has a consensus target price of $853.12, indicating a potential upside of 11.06%. Great Ajax has a consensus target price of $15.00, indicating a potential upside of 51.36%. Given Great Ajax’s stronger consensus rating and higher probable upside, analysts plainly believe Great Ajax is more favorable than Equinix.

Volatility & Risk

Equinix has a beta of 0.46, suggesting that its stock price is 54% less volatile than the S&P 500. Comparatively, Great Ajax has a beta of 1.77, suggesting that its stock price is 77% more volatile than the S&P 500.

Dividends

Equinix pays an annual dividend of $12.40 per share and has a dividend yield of 1.6%. Great Ajax pays an annual dividend of $1.04 per share and has a dividend yield of 10.5%. Equinix pays out 223.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Great Ajax pays out 73.2% of its earnings in the form of a dividend. Equinix has raised its dividend for 7 consecutive years and Great Ajax has raised its dividend for 2 consecutive years. Great Ajax is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

94.4% of Equinix shares are held by institutional investors. Comparatively, 76.3% of Great Ajax shares are held by institutional investors. 13.2% of Equinix shares are held by insiders. Comparatively, 6.5% of Great Ajax shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Equinix beats Great Ajax on 11 of the 18 factors compared between the two stocks.

Equinix Company Profile (Get Rating)

Equinix (Nasdaq: EQIX) is the world's digital infrastructure company, enabling digital leaders to harness a trusted platform to bring together and interconnect the foundational infrastructure that powers their success. Equinix enables today's businesses to access all the right places, partners and possibilities they need to accelerate advantage. With Equinix, they can scale with agility, speed the launch of digital services, deliver world-class experiences and multiply their value.

Great Ajax Company Profile (Get Rating)

Great Ajax Corp., real estate company, acquires, invests in, and manages a portfolio of residential mortgage and small balance commercial mortgage loans. The company also holds real estate owned properties acquired upon the foreclosure or other settlement of its non-performing loans, as well as through outright purchases. In addition, it acquires and originates small balance commercial loans (SBC) secured by multi-family residential and commercial mixed-use retail/residential properties; and invests in single-family and smaller commercial properties through a foreclosure event of a loan or a direct acquisition. The company elected to be taxed as a real estate investment trust for U.S. federal income tax purposes. It generally would not be subject to federal corporate income taxes, if it distributes at least 90% of its taxable income to its stockholders. Great Ajax Corp. was incorporated in 2014 and is based in Tigard, Oregon.

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