Analyzing Extra Space Storage (NYSE:EXR) and SBA Communications (NASDAQ:SBAC)

SBA Communications (NASDAQ:SBAC) and Extra Space Storage (NYSE:EXR) are both large-cap real estate companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, analyst recommendations, valuation, institutional ownership, earnings, profitability and risk.

Analyst Ratings

This is a breakdown of current ratings and price targets for SBA Communications and Extra Space Storage, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SBA Communications	0	9	7	0	2.44
Extra Space Storage	0	9	7	0	2.44

SBA Communications presently has a consensus price target of $225.53, suggesting a potential upside of 24.32%. Extra Space Storage has a consensus price target of $148.93, suggesting a potential upside of 9.15%. Given SBA Communications’ higher possible upside, analysts clearly believe SBA Communications is more favorable than Extra Space Storage.

Risk & Volatility

SBA Communications has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500. Comparatively, Extra Space Storage has a beta of 1.16, indicating that its stock price is 16% more volatile than the S&P 500.

Institutional and Insider Ownership

97.3% of SBA Communications shares are held by institutional investors. Comparatively, 99.1% of Extra Space Storage shares are held by institutional investors. 9.5% of SBA Communications shares are held by insiders. Comparatively, 1.0% of Extra Space Storage shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

SBA Communications pays an annual dividend of $5.00 per share and has a dividend yield of 2.8%. Extra Space Storage pays an annual dividend of $6.48 per share and has a dividend yield of 4.7%. SBA Communications pays out 53.9% of its earnings in the form of a dividend. Extra Space Storage pays out 143.0% 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 has raised its dividend for 6 consecutive years and Extra Space Storage has raised its dividend for 1 consecutive years.

Profitability

This table compares SBA Communications and Extra Space Storage’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%
Extra Space Storage	27.80%	6.70%	3.27%

Earnings & Valuation

This table compares SBA Communications and Extra Space Storage”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SBA Communications	$2.82 billion	6.84	$1.05 billion	$9.28	19.55
Extra Space Storage	$3.38 billion	8.53	$974.00 million	$4.53	30.12

SBA Communications has higher earnings, but lower revenue than Extra Space Storage. SBA Communications is trading at a lower price-to-earnings ratio than Extra Space Storage, indicating that it is currently the more affordable of the two stocks.

Summary

SBA Communications beats Extra Space Storage on 8 of the 15 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 Extra Space Storage

Extra Space Storage Inc., headquartered in Salt Lake City, Utah, is a self-administered and self-managed REIT and a member of the S&P 500. As of December 31, 2023, the Company owned and/or operated 3,714 self-storage stores in 42 states and Washington, D.C. The Company's stores comprise approximately 2.6 million units and approximately 283.0 million square feet of rentable space operating under the Extra Space, Life Storage and Storage Express brands. The Company offers customers a wide selection of conveniently located and secure storage units across the country, including boat storage, RV storage and business storage. It is the largest operator of self-storage properties in the United States.