Weyerhaeuser (NYSE:WY) and Ventas (NYSE:VTR) are both large-cap construction companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, dividends, profitability, valuation, earnings, institutional ownership and risk.
Risk and Volatility
Weyerhaeuser has a beta of 1.96, indicating that its stock price is 96% more volatile than the S&P 500. Comparatively, Ventas has a beta of 1.06, indicating that its stock price is 6% more volatile than the S&P 500.
Valuation & Earnings
This table compares Weyerhaeuser and Ventas' gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
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Weyerhaeuser | $6.55 billion | 3.78 | $-76,000,000.00 | $0.39 | 85.15 |
Ventas | $3.87 billion | 4.75 | $433.02 million | $3.85 | 12.76 |
Ventas has lower revenue, but higher earnings than Weyerhaeuser. Ventas is trading at a lower price-to-earnings ratio than Weyerhaeuser, indicating that it is currently the more affordable of the two stocks.
Dividends
Weyerhaeuser pays an annual dividend of $0.68 per share and has a dividend yield of 2.0%. Ventas pays an annual dividend of $1.80 per share and has a dividend yield of 3.7%. Weyerhaeuser pays out 174.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ventas pays out 46.8% of its earnings in the form of a dividend. Ventas has raised its dividend for 1 consecutive years. Ventas is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Insider and Institutional Ownership
77.5% of Weyerhaeuser shares are held by institutional investors. Comparatively, 90.5% of Ventas shares are held by institutional investors. 0.3% of Weyerhaeuser shares are held by company insiders. Comparatively, 1.2% of Ventas shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Profitability
This table compares Weyerhaeuser and Ventas' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
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Weyerhaeuser | 4.67% | 3.59% | 1.78% |
Ventas | 10.49% | 3.88% | 1.64% |
Analyst Ratings
This is a breakdown of current ratings and recommmendations for Weyerhaeuser and Ventas, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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Weyerhaeuser | 0 | 3 | 5 | 0 | 2.63 |
Ventas | 4 | 10 | 3 | 0 | 1.94 |
Weyerhaeuser currently has a consensus price target of $30.50, indicating a potential downside of 8.16%. Ventas has a consensus price target of $44.7778, indicating a potential downside of 8.86%. Given Weyerhaeuser's stronger consensus rating and higher probable upside, equities analysts plainly believe Weyerhaeuser is more favorable than Ventas.
Summary
Ventas beats Weyerhaeuser on 10 of the 17 factors compared between the two stocks.