Financial Review: SBA Communications (NASDAQ:SBAC) vs. First Industrial Realty Trust (NYSE:FR)

SBA Communications (NASDAQ:SBAC) and First Industrial Realty Trust (NYSE:FR) are both real estate companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, valuation, analyst recommendations, institutional ownership, earnings, profitability and dividends.

Analyst Ratings

This is a summary of recent recommendations for SBA Communications and First Industrial Realty Trust, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SBA Communications	0	9	8	0	2.47
First Industrial Realty Trust	0	7	7	1	2.60

SBA Communications presently has a consensus price target of $228.12, indicating a potential upside of 23.79%. First Industrial Realty Trust has a consensus price target of $66.86, indicating a potential upside of 4.99%. Given SBA Communications’ higher probable upside, equities analysts clearly believe SBA Communications is more favorable than First Industrial Realty Trust.

Dividends

SBA Communications pays an annual dividend of $5.00 per share and has a dividend yield of 2.7%. First Industrial Realty Trust pays an annual dividend of $2.00 per share and has a dividend yield of 3.1%. SBA Communications pays out 53.9% of its earnings in the form of a dividend. First Industrial Realty Trust pays out 73.0% 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 increased its dividend for 6 consecutive years and First Industrial Realty Trust has increased its dividend for 12 consecutive years. First Industrial Realty Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

SBA Communications has a beta of 0.99, meaning that its stock price is 1% less volatile than the S&P 500. Comparatively, First Industrial Realty Trust has a beta of 1.04, meaning that its stock price is 4% more volatile than the S&P 500.

Earnings and Valuation

This table compares SBA Communications and First Industrial Realty Trust”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	$2.87 billion	6.81	$1.05 billion	$9.28	19.86
First Industrial Realty Trust	$759.61 million	11.11	$247.44 million	$2.74	23.24

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
SBA Communications	34.51%	-20.67%	8.56%
First Industrial Realty Trust	47.97%	12.99%	6.41%

Institutional and Insider Ownership

97.3% of SBA Communications shares are owned by institutional investors. Comparatively, 99.8% of First Industrial Realty Trust shares are owned by institutional investors. 9.5% of SBA Communications shares are owned by insiders. Comparatively, 1.1% of First Industrial Realty Trust shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

First Industrial Realty Trust beats SBA Communications on 10 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 First Industrial Realty Trust

First Industrial Realty Trust, Inc. (NYSE: FR) is a leading U.S.-only owner, operator, developer and acquirer of logistics properties. Through our fully integrated operating and investing platform, we provide high quality facilities and industry-leading customer service to multinational corporations and regional firms that are essential for their supply chains. Our portfolio and new investments are concentrated in 15 target MSAs with an emphasis on supply-constrained, coastally oriented markets. In total, we own and have under development approximately 68.5 million square feet of industrial space as of December 31, 2023.