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

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

Dividends

Extra Space Storage pays an annual dividend of $6.48 per share and has a dividend yield of 4.7%. SBA Communications pays an annual dividend of $5.00 per share and has a dividend yield of 2.6%. 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 pays out 53.9% of its earnings in the form of a dividend. Extra Space Storage has raised its dividend for 1 consecutive years and SBA Communications has raised its dividend for 6 consecutive years.

Institutional & Insider Ownership

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

Profitability

This table compares Extra Space Storage and SBA Communications’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Extra Space Storage	27.80%	6.70%	3.27%
SBA Communications	34.51%	-20.67%	8.56%

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Extra Space Storage	$3.45 billion	8.54	$974.00 million	$4.53	30.76
SBA Communications	$2.87 billion	7.00	$1.05 billion	$9.28	20.41

SBA Communications has lower revenue, but higher earnings 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.

Analyst Recommendations

This is a summary of recent ratings and target prices for Extra Space Storage and SBA Communications, as reported by MarketBeat.

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

Extra Space Storage currently has a consensus price target of $148.93, indicating a potential upside of 6.89%. SBA Communications has a consensus price target of $225.53, indicating a potential upside of 19.05%. Given SBA Communications’ higher possible upside, analysts clearly believe SBA Communications is more favorable than Extra Space Storage.

Risk and Volatility

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

Summary

SBA Communications beats Extra Space Storage on 8 of the 15 factors compared between the two stocks.

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.

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.