Analyzing Rayonier (RYN) and CatchMark Timber Trust (CTT)

Rayonier (NYSE: RYN) and CatchMark Timber Trust (NYSE:CTT) are both financials companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, dividends, institutional ownership, risk, earnings, profitability and analyst recommendations.

Profitability

This table compares Rayonier and CatchMark Timber Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Rayonier 16.19% 6.33% 3.94%
CatchMark Timber Trust -15.09% -3.64% -1.90%

Analyst Recommendations

This is a breakdown of current recommendations for Rayonier and CatchMark Timber Trust, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Rayonier 0 3 2 0 2.40
CatchMark Timber Trust 0 0 1 0 3.00

Rayonier currently has a consensus price target of $30.00, suggesting a potential downside of 5.60%. CatchMark Timber Trust has a consensus price target of $12.50, suggesting a potential downside of 6.65%. Given Rayonier’s higher probable upside, analysts plainly believe Rayonier is more favorable than CatchMark Timber Trust.

Institutional and Insider Ownership

83.0% of Rayonier shares are held by institutional investors. Comparatively, 63.7% of CatchMark Timber Trust shares are held by institutional investors. 0.6% of Rayonier shares are held by insiders. Comparatively, 1.2% of CatchMark Timber Trust shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Rayonier and CatchMark Timber Trust’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Rayonier $788.30 million 5.20 $211.97 million $1.05 30.27
CatchMark Timber Trust $81.86 million 7.10 -$11.07 million ($0.35) -38.26

Rayonier has higher revenue and earnings than CatchMark Timber Trust. CatchMark Timber Trust is trading at a lower price-to-earnings ratio than Rayonier, indicating that it is currently the more affordable of the two stocks.

Dividends

Rayonier pays an annual dividend of $1.00 per share and has a dividend yield of 3.1%. CatchMark Timber Trust pays an annual dividend of $0.54 per share and has a dividend yield of 4.0%. Rayonier pays out 95.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CatchMark Timber Trust pays out -154.3% of its earnings in the form of a dividend. Rayonier has increased its dividend for 2 consecutive years. CatchMark Timber Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

Rayonier has a beta of 0.36, indicating that its share price is 64% less volatile than the S&P 500. Comparatively, CatchMark Timber Trust has a beta of 0.68, indicating that its share price is 32% less volatile than the S&P 500.

Summary

Rayonier beats CatchMark Timber Trust on 10 of the 16 factors compared between the two stocks.

Rayonier Company Profile

Rayonier Inc. is a timberland real estate investment trust with assets located in some of the timber growing regions in the United States and New Zealand. The Company operates through five segments: Southern Timber, Pacific Northwest Timber, New Zealand Timber, Real Estate and Trading. The Southern Timber, Pacific Northwest Timber and New Zealand Timber segments reflect all activities related to the harvesting of timber and other activities, such as recreational leases, within each respective geography. Its New Zealand Timber segment also reflects land sales that occur within its New Zealand portfolio. Its Real Estate segment reflects the United States land sales. Its Trading segment reflects the log trading activities that support its New Zealand operations. It owned, leased or managed approximately 2.7 million acres of timberlands, as of December 31, 2016. It is engaged in the trading of logs from New Zealand and Australia to Pacific Rim markets.

CatchMark Timber Trust Company Profile

CatchMark Timber Trust, Inc. is a real estate company investing in timberlands. The Company primarily engages in the ownership, management, acquisition and disposition of timberlands located in the United States. It is focused on investing in timberlands and to manage such assets to provide current income and attractive long-term returns to its stockholders. It owns all its properties and other investments through its operating partnership. The Company generates its income from the harvest and sale of timber, as well as from non-timber related revenue sources, such as recreational leases. In April 2014, the Company acquired 36,300 acres of timberland (known as the Waycross-Panola properties) located in Southeast Georgia and East Texas from Hancock Timber Resource Group. Approximately 55,600 acres of prime timberlands, known as Oglethorpe and Satilla River, add 2.7 million tons of timber to the Company’s merchantable inventory.

Receive News & Ratings for Rayonier Inc. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Rayonier Inc. and related companies with MarketBeat.com's FREE daily email newsletter.

Leave a Reply