Alexandria Real Estate Equities (NYSE:ARE) & SBA Communications (NASDAQ:SBAC) Head-To-Head Review

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

Earnings and Valuation

This table compares SBA Communications and Alexandria Real Estate Equities”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SBA Communications	$2.82 billion	7.66	$1.05 billion	$9.50	21.40
Alexandria Real Estate Equities	$3.03 billion	2.69	-$1.43 billion	($6.27)	-7.44

SBA Communications has higher earnings, but lower revenue than Alexandria Real Estate Equities. Alexandria Real Estate Equities 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 SBA Communications and Alexandria Real Estate Equities’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SBA Communications	35.66%	-20.90%	8.98%
Alexandria Real Estate Equities	-36.03%	-5.21%	-2.96%

Institutional & Insider Ownership

97.4% of SBA Communications shares are held by institutional investors. Comparatively, 96.5% of Alexandria Real Estate Equities shares are held by institutional investors. 9.5% of SBA Communications shares are held by insiders. Comparatively, 1.4% of Alexandria Real Estate Equities shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Volatility & Risk

SBA Communications has a beta of 1.03, suggesting that its share price is 3% more volatile than the S&P 500. Comparatively, Alexandria Real Estate Equities has a beta of 1.12, suggesting that its share price is 12% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for SBA Communications and Alexandria Real Estate Equities, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SBA Communications	0	10	8	1	2.53
Alexandria Real Estate Equities	2	11	3	0	2.06

SBA Communications currently has a consensus target price of $237.74, suggesting a potential upside of 16.92%. Alexandria Real Estate Equities has a consensus target price of $51.92, suggesting a potential upside of 11.27%. Given SBA Communications’ stronger consensus rating and higher probable upside, equities research analysts plainly believe SBA Communications is more favorable than Alexandria Real Estate Equities.

Dividends

SBA Communications pays an annual dividend of $5.00 per share and has a dividend yield of 2.5%. Alexandria Real Estate Equities pays an annual dividend of $2.88 per share and has a dividend yield of 6.2%. SBA Communications pays out 52.6% of its earnings in the form of a dividend. Alexandria Real Estate Equities pays out -45.9% 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 Alexandria Real Estate Equities has increased its dividend for 15 consecutive years. Alexandria Real Estate Equities is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

SBA Communications beats Alexandria Real Estate Equities on 12 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 Alexandria Real Estate Equities

Alexandria Real Estate Equities, Inc. (NYSE: ARE), an S&P 500 company, is a best-in-class, mission-driven life science REIT making a positive and lasting impact on the world. As the pioneer of the life science real estate niche since our founding in 1994, Alexandria is the preeminent and longest-tenured owner, operator, and developer of collaborative life science, agtech, and advanced technology mega campuses in AAA innovation cluster locations, including Greater Boston, the San Francisco Bay Area, New York City, San Diego, Seattle, Maryland, and Research Triangle. Alexandria has a total market capitalization of $33.1 billion and an asset base in North America of 73.5 million SF as of December 31, 2023, which includes 42.0 million RSF of operating properties, 5.5 million RSF of Class A/A+ properties undergoing construction and one near-term project expected to commence construction in the next two years, 2.1 million RSF of priority anticipated development and redevelopment projects, and 23.9 million SF of future development projects. Alexandria has a longstanding and proven track record of developing Class A/A+ properties clustered in life science, agtech, and advanced technology mega campuses that provide our innovative tenants with highly dynamic and collaborative environments that enhance their ability to successfully recruit and retain world-class talent and inspire productivity, efficiency, creativity, and success. Alexandria also provides strategic capital to transformative life science, agrifoodtech, climate innovation, and technology companies through our venture capital platform. We believe our unique business model and diligent underwriting ensure a high-quality and diverse tenant base that results in higher occupancy levels, longer lease terms, higher rental income, higher returns, and greater long-term asset value.