CyrusOne (CONE) versus Drive Shack (DS) Financial Review
CyrusOne (NASDAQ: CONE) and Drive Shack (NYSE:DS) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, earnings, analyst recommendations, valuation, profitability and risk.
Insider & Institutional Ownership
96.5% of CyrusOne shares are owned by institutional investors. Comparatively, 41.8% of Drive Shack shares are owned by institutional investors. 1.6% of CyrusOne shares are owned by company insiders. Comparatively, 7.2% of Drive Shack shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Volatility & Risk
CyrusOne has a beta of 0.81, meaning that its stock price is 19% less volatile than the S&P 500. Comparatively, Drive Shack has a beta of 1.21, meaning that its stock price is 21% more volatile than the S&P 500.
CyrusOne pays an annual dividend of $1.68 per share and has a dividend yield of 2.7%. Drive Shack pays an annual dividend of $0.24 per share and has a dividend yield of 6.6%. CyrusOne pays out -541.9% of its earnings in the form of a dividend. Drive Shack pays out -68.6% 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.
This is a summary of recent ratings and target prices for CyrusOne and Drive Shack, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
CyrusOne currently has a consensus price target of $60.67, indicating a potential downside of 3.38%. Drive Shack has a consensus price target of $3.75, indicating a potential upside of 2.46%. Given Drive Shack’s higher possible upside, analysts clearly believe Drive Shack is more favorable than CyrusOne.
Earnings and Valuation
This table compares CyrusOne and Drive Shack’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|CyrusOne||$597.40 million||N/A||$296.60 million||($0.31)||-202.54|
|Drive Shack||$292.74 million||0.84||$8.22 million||($0.35)||-10.46|
CyrusOne has higher revenue and earnings than Drive Shack. CyrusOne is trading at a lower price-to-earnings ratio than Drive Shack, indicating that it is currently the more affordable of the two stocks.
This table compares CyrusOne and Drive Shack’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
CyrusOne beats Drive Shack on 9 of the 15 factors compared between the two stocks.
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.
About Drive Shack
Drive Shack Inc., formerly Newcastle Investment Corp., is a leisure company. The Company is an owner and operator of golf-related leisure and entertainment businesses. The Company’s portfolio consists of Drive Shack, which is engaged in developing nationwide network of golf entertainment venues; American Golf Corporation, which is a golf course company, and real estate-related assets. American Golf Corporation operates approximately 90 private, resort and public golf courses throughout the United States. It has a range of public and private golf courses in California, New York, and Georgia. It operates multiple facilities that provide golf, tennis, swimming and spa facilities, among others. Its online Pro Shop offers a range of golf gifts, such as personalized golf balls, golf luggage and accessories. Its public golf courses equipped with practice areas, golf shops, driving ranges, and food and beverage options.
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