Head to Head Comparison: Corrections Corp. of America (CXW) versus CyrusOne (CONE)
Corrections Corp. of America (NYSE: CXW) and CyrusOne (NASDAQ:CONE) are both mid-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, dividends, institutional ownership, risk, valuation, analyst recommendations and earnings.
Volatility & Risk
Corrections Corp. of America has a beta of 0.92, meaning that its stock price is 8% less volatile than the S&P 500. Comparatively, CyrusOne has a beta of 0.83, meaning that its stock price is 17% less volatile than the S&P 500.
This table compares Corrections Corp. of America and CyrusOne’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Corrections Corp. of America||11.62%||14.54%||6.51%|
Corrections Corp. of America pays an annual dividend of $1.68 per share and has a dividend yield of 6.3%. CyrusOne pays an annual dividend of $1.68 per share and has a dividend yield of 2.6%. Corrections Corp. of America pays out 93.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CyrusOne pays out -541.9% of its earnings in the form of a dividend. CyrusOne has increased its dividend for 4 consecutive years.
This is a summary of recent recommendations and price targets for Corrections Corp. of America and CyrusOne, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Corrections Corp. of America||0||1||3||0||2.75|
Corrections Corp. of America presently has a consensus price target of $30.33, indicating a potential upside of 12.85%. CyrusOne has a consensus price target of $61.00, indicating a potential downside of 4.72%. Given Corrections Corp. of America’s higher possible upside, research analysts plainly believe Corrections Corp. of America is more favorable than CyrusOne.
Earnings & Valuation
This table compares Corrections Corp. of America and CyrusOne’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Corrections Corp. of America||$1.82 billion||1.75||$452.80 million||$1.79||15.02|
|CyrusOne||$597.40 million||9.44||$296.60 million||($0.31)||-206.51|
Corrections Corp. of America has higher revenue and earnings than CyrusOne. CyrusOne is trading at a lower price-to-earnings ratio than Corrections Corp. of America, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
86.2% of Corrections Corp. of America shares are held by institutional investors. Comparatively, 96.7% of CyrusOne shares are held by institutional investors. 1.3% of Corrections Corp. of America shares are held by insiders. Comparatively, 1.6% of CyrusOne shares are held by 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.
Corrections Corp. of America beats CyrusOne on 9 of the 15 factors compared between the two stocks.
About Corrections Corp. of America
CoreCivic, Inc., formerly Corrections Corporation of America, is a diversified government solutions company. The Company provides partnership correctional, detention and residential reentry facilities and operates prison in the United States. The Company’s business offerings include CoreCivic Safety, CoreCivic Properties, and CoreCivic Community. The Company provides a range of solutions to government partners that serve the public good corrections and detention management, government real estate solutions, and network of residential reentry centers. As of March 31, 2017, the Company owned or controlled 48 correctional and detention facilities, owned or controlled 27 residential reentry centers, and managed an additional 11 correctional and detention facilities owned by its government partners, with a total design capacity of approximately 88,400 beds in 20 states.
CyrusOne Inc. is a real estate investment trust. The Company is an owner, operator and developer of enterprise-class, carrier-neutral, multi-tenant data center properties. The Company’s data centers are generally purpose-built facilities with redundant power and cooling. The CyrusOne National IX Platform (the National IX Platform) delivers interconnection across states and between metro-enabled sites within its footprint and beyond. The Company has data centers in the United States, London and Singapore. As of December 31, 2016, the Company provided mission-critical data center facilities for 932 customers in 35 data centers and two recovery centers in 11 distinct markets (nine cities in the United States, London and Singapore) with approximately 3,904,000 net rentable square feet (NRSF). The Company provides round the clock security guard monitoring with customizable security features. As of December 31, 2016, the Company had approximately 1,657,000 NRSF under development.
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