Financial Review: SBA Communications (NASDAQ:SBAC) and Rayonier (NYSE:RYN)

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

Profitability

This table compares Rayonier and SBA Communications’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rayonier	7.83%	3.49%	2.37%
SBA Communications	34.51%	-20.67%	8.56%

Analyst Recommendations

This is a summary of current recommendations and price targets for Rayonier and SBA Communications, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rayonier	0	5	0	1	2.33
SBA Communications	0	9	7	0	2.44

Rayonier presently has a consensus price target of $24.80, indicating a potential upside of 22.18%. SBA Communications has a consensus price target of $225.53, indicating a potential upside of 18.03%. Given Rayonier’s higher probable upside, analysts clearly believe Rayonier is more favorable than SBA Communications.

Institutional and Insider Ownership

89.1% of Rayonier shares are held by institutional investors. Comparatively, 97.3% of SBA Communications shares are held by institutional investors. 0.9% of Rayonier shares are held by insiders. Comparatively, 9.5% of SBA Communications 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.

Earnings and Valuation

This table compares Rayonier and SBA Communications”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rayonier	$484.50 million	12.47	$474.38 million	$0.45	45.11
SBA Communications	$2.82 billion	7.20	$1.05 billion	$9.28	20.59

SBA Communications has higher revenue and earnings than Rayonier. SBA Communications 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 $1.04 per share and has a dividend yield of 5.1%. SBA Communications pays an annual dividend of $5.00 per share and has a dividend yield of 2.6%. Rayonier pays out 231.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. SBA Communications pays out 53.9% of its earnings in the form of a dividend. SBA Communications has increased its dividend for 6 consecutive years.

Volatility & Risk

Rayonier has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500. Comparatively, SBA Communications has a beta of 0.99, indicating that its share price is 1% less volatile than the S&P 500.

Summary

SBA Communications beats Rayonier on 12 of the 18 factors compared between the two stocks.

About Rayonier

Rayonier is a leading timberland real estate investment trust with assets located in some of the most productive softwood timber growing regions in the United States and New Zealand. As of December 31, 2023, Rayonier owned or leased under long-term agreements approximately 2.7 million acres of timberlands located in the U.S. South (1.85 million acres), U.S. Pacific Northwest (418,000 acres) and New Zealand (421,000 acres).

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.