Seritage Growth Properties (NYSE:SRG) and SBA Communications (NASDAQ:SBAC) Critical Contrast

SBA Communications (NASDAQ:SBAC) and Seritage Growth Properties (NYSE:SRG) are both finance companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, dividends, analyst recommendations, risk, profitability and earnings.

Risk & Volatility

SBA Communications has a beta of 0.87, meaning that its share price is 13% less volatile than the S&P 500. Comparatively, Seritage Growth Properties has a beta of 2.33, meaning that its share price is 133% more volatile than the S&P 500.

Insider and Institutional Ownership

97.4% of SBA Communications shares are held by institutional investors. Comparatively, 78.9% of Seritage Growth Properties shares are held by institutional investors. 0.9% of SBA Communications shares are held by insiders. Comparatively, 0.6% of Seritage Growth Properties shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares SBA Communications and Seritage Growth Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SBA Communications	29.69%	-16.60%	7.55%
Seritage Growth Properties	-404.37%	-20.13%	-12.10%

Dividends

SBA Communications pays an annual dividend of $4.44 per share and has a dividend yield of 2.3%. Seritage Growth Properties pays an annual dividend of $1.00 per share and has a dividend yield of 30.9%. SBA Communications pays out 57.9% of its earnings in the form of a dividend. Seritage Growth Properties pays out -70.4% 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. SBA Communications has raised its dividend for 6 consecutive years. Seritage Growth Properties is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of recent ratings and target prices for SBA Communications and Seritage Growth Properties, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SBA Communications	0	8	8	2	2.67
Seritage Growth Properties	1	0	0	0	1.00

SBA Communications presently has a consensus target price of $237.00, suggesting a potential upside of 22.52%. Given SBA Communications’ stronger consensus rating and higher probable upside, equities research analysts clearly believe SBA Communications is more favorable than Seritage Growth Properties.

Valuation and Earnings

This table compares SBA Communications and Seritage Growth Properties”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SBA Communications	$2.68 billion	7.69	$749.54 million	$7.67	25.22
Seritage Growth Properties	$18.42 million	9.91	-$153.54 million	($1.42)	-2.28

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

Summary

SBA Communications beats Seritage Growth Properties on 14 of the 18 factors compared between the two stocks.

About SBA Communications

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 throughout the Americas, Africa and in Asia, 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 Seritage Growth Properties

Seritage Growth Properties operates as a real estate investment trust. The firm engages in the acquisition, ownership, development, redevelopment, management, and leasing of retail properties throughout the United States. Its property portfolio includes mall, shopping centers and freestanding locations. The company was founded on June 3, 2015 and is headquartered in New York, NY.