Starwood Property Trust (NYSE:STWD) vs. SBA Communications (NASDAQ:SBAC) Head-To-Head Contrast

Starwood Property Trust (NYSE:STWD) and SBA Communications (NASDAQ:SBAC) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their risk, institutional ownership, analyst recommendations, earnings, dividends, valuation and profitability.

Valuation and Earnings

This table compares Starwood Property Trust and SBA Communications’ top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Starwood Property Trust	$2.05 billion	3.09	$339.21 million	$1.39	14.40
SBA Communications	$2.71 billion	8.26	$501.81 million	$5.10	40.87

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

Profitability

This table compares Starwood Property Trust and SBA Communications’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Starwood Property Trust	21.20%	9.99%	0.96%
SBA Communications	20.61%	-10.75%	5.40%

Dividends

Starwood Property Trust pays an annual dividend of $1.92 per share and has a dividend yield of 9.6%. SBA Communications pays an annual dividend of $3.92 per share and has a dividend yield of 1.9%. Starwood Property Trust pays out 138.1% 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 76.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Starwood Property Trust and SBA Communications, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Starwood Property Trust	0	4	3	1	2.63
SBA Communications	0	2	9	1	2.92

Starwood Property Trust currently has a consensus price target of $21.50, suggesting a potential upside of 8.20%. SBA Communications has a consensus price target of $248.31, suggesting a potential upside of 17.92%. Given SBA Communications’ stronger consensus rating and higher probable upside, analysts clearly believe SBA Communications is more favorable than Starwood Property Trust.

Volatility and Risk

Starwood Property Trust has a beta of 1.69, indicating that its stock price is 69% more volatile than the S&P 500. Comparatively, SBA Communications has a beta of 0.65, indicating that its stock price is 35% less volatile than the S&P 500.

Institutional and Insider Ownership

49.8% of Starwood Property Trust shares are owned by institutional investors. Comparatively, 97.4% of SBA Communications shares are owned by institutional investors. 5.4% of Starwood Property Trust shares are owned by company insiders. Comparatively, 1.3% of SBA Communications shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

SBA Communications beats Starwood Property Trust on 11 of the 16 factors compared between the two stocks.

About Starwood Property Trust

Starwood Property Trust, Inc. operates as a real estate investment trust (REIT) in the United States and internationally. The company operates through Commercial and Residential Lending, Infrastructure Lending, Property, and Investing and Servicing segments. The Commercial and Residential Lending segment originates, acquires, finances, and manages commercial first mortgages, non-agency residential mortgages, subordinated mortgages, mezzanine loans, preferred equity, commercial mortgage-backed securities (CMBS), and residential mortgage-backed securities, as well as other real estate and real estate-related debt investments, include distressed or non-performing loans. The Infrastructure lending segment originates, acquires, finances, and manages infrastructure debt investments. The Property segment engages primarily in acquiring and managing equity interests in stabilized commercial real estate properties, such as multifamily properties and commercial properties subject to net leases, that are held for investment. The Investing and Servicing segment manages and works out problem assets; acquires and manages unrated, investment grade, and non-investment grade rated CMBS comprising subordinated interests of securitization and re-securitization transactions; originates conduit loans for the primary purpose of selling these loans into securitization transactions; and acquires commercial real estate assets that include properties acquired from CMBS trusts. The company qualifies as a REIT for federal income tax purposes and would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was incorporated in 2009 and is headquartered in Greenwich, Connecticut.

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.