CyrusOne (NASDAQ:CONE) and Alexandria Real Estate Equities (NYSE:ARE) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, profitability, earnings, dividends and valuation.
Dividends
CyrusOne pays an annual dividend of $2.04 per share and has a dividend yield of 3.1%. Alexandria Real Estate Equities pays an annual dividend of $4.36 per share and has a dividend yield of 2.7%. CyrusOne pays out 56.2% of its earnings in the form of a dividend. Alexandria Real Estate Equities pays out 62.6% 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. CyrusOne has raised its dividend for 7 consecutive years and Alexandria Real Estate Equities has raised its dividend for 10 consecutive years. CyrusOne is clearly the better dividend stock, given its higher yield and lower payout ratio.
Risk and Volatility
CyrusOne has a beta of 0.46, meaning that its stock price is 54% less volatile than the S&P 500. Comparatively, Alexandria Real Estate Equities has a beta of 0.8, meaning that its stock price is 20% less volatile than the S&P 500.
Profitability
This table compares CyrusOne and Alexandria Real Estate Equities' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
CyrusOne | -2.91% | 1.23% | 0.47% |
Alexandria Real Estate Equities | 29.07% | 4.79% | 2.66% |
Analyst Ratings
This is a breakdown of recent ratings and price targets for CyrusOne and Alexandria Real Estate Equities, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
CyrusOne | 0 | 5 | 9 | 0 | 2.64 |
Alexandria Real Estate Equities | 0 | 1 | 6 | 0 | 2.86 |
CyrusOne currently has a consensus target price of $81.8571, indicating a potential upside of 25.62%. Alexandria Real Estate Equities has a consensus target price of $160.8750, indicating a potential upside of 0.78%. Given CyrusOne's higher possible upside, analysts clearly believe CyrusOne is more favorable than Alexandria Real Estate Equities.
Valuation & Earnings
This table compares CyrusOne and Alexandria Real Estate Equities' gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
CyrusOne | $981.30 million | 8.00 | $41.40 million | $3.63 | 17.95 |
Alexandria Real Estate Equities | $1.53 billion | 14.25 | $363.17 million | $6.96 | 22.93 |
Alexandria Real Estate Equities has higher revenue and earnings than CyrusOne. CyrusOne is trading at a lower price-to-earnings ratio than Alexandria Real Estate Equities, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
98.3% of CyrusOne shares are held by institutional investors. Comparatively, 87.6% of Alexandria Real Estate Equities shares are held by institutional investors. 0.6% of CyrusOne shares are held by company insiders. Comparatively, 1.1% of Alexandria Real Estate Equities shares are held 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
Alexandria Real Estate Equities beats CyrusOne on 12 of the 17 factors compared between the two stocks.