Geo Group (NYSE: GEO) and CyrusOne (NASDAQ:CONE) are both mid-cap financials companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, earnings, risk, institutional ownership, profitability, analyst recommendations and valuation.
Insider and Institutional Ownership
95.8% of Geo Group shares are owned by institutional investors. Comparatively, 95.1% of CyrusOne shares are owned by institutional investors. 2.4% of Geo Group shares are owned by company insiders. Comparatively, 1.6% of CyrusOne shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
This table compares Geo Group and CyrusOne’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation and Earnings
This table compares Geo Group and CyrusOne’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Geo Group||$2.18 billion||1.48||$148.71 million||$1.36||19.12|
|CyrusOne||$529.10 million||10.69||$19.90 million||($0.98)||-63.19|
Geo Group has higher revenue and earnings than CyrusOne. CyrusOne is trading at a lower price-to-earnings ratio than Geo Group, indicating that it is currently the more affordable of the two stocks.
Geo Group pays an annual dividend of $1.88 per share and has a dividend yield of 7.2%. CyrusOne pays an annual dividend of $1.68 per share and has a dividend yield of 2.7%. Geo Group pays out 138.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CyrusOne pays out -171.4% of its earnings in the form of a dividend. CyrusOne has raised its dividend for 4 consecutive years.
Risk & Volatility
Geo Group has a beta of 1.5, indicating that its share price is 50% more volatile than the S&P 500. Comparatively, CyrusOne has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500.
This is a summary of current ratings and price targets for Geo Group and CyrusOne, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Geo Group presently has a consensus target price of $33.78, suggesting a potential upside of 29.91%. CyrusOne has a consensus target price of $62.67, suggesting a potential upside of 1.19%. Given Geo Group’s higher possible upside, analysts plainly believe Geo Group is more favorable than CyrusOne.
Geo Group beats CyrusOne on 11 of the 17 factors compared between the two stocks.
Geo Group Company Profile
The GEO Group, Inc. is a real estate investment trust (REIT) specializing in the ownership, leasing and management of correctional, detention and re-entry facilities and the provision of community-based services and youth services in the United States, Australia, South Africa, the United Kingdom and Canada. As of December 31, 2013, its worldwide operations included the management and/or ownership of approximately 77,000 beds at 98 correctional, detention and community based facilities, including idle faclities and projects under development, and also included the provision of monitoring of more than 70,000 offenders in a community-based environment on behalf of approximately 900 federal, state and local correctional agencies located in all 50 states. The Company operates in four segments: United States Corrections and Detention segment, segment; International Services segment and Facility Construction and Design segment.
CyrusOne Company Profile
CyrusOne Inc. is a real estate investment trust. The Company is an owner, operator and developer of enterprise-class, carrier-neutral, multi-tenant data center properties. The Company’s data centers are generally purpose-built facilities with redundant power and cooling. The CyrusOne National IX Platform (the National IX Platform) delivers interconnection across states and between metro-enabled sites within its footprint and beyond. The Company has data centers in the United States, London and Singapore. As of December 31, 2016, the Company provided mission-critical data center facilities for 932 customers in 35 data centers and two recovery centers in 11 distinct markets (nine cities in the United States, London and Singapore) with approximately 3,904,000 net rentable square feet (NRSF). The Company provides round the clock security guard monitoring with customizable security features. As of December 31, 2016, the Company had approximately 1,657,000 NRSF under development.
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