Critical Contrast: Colony Capital (CLNY) versus Silver Bay Realty Trust Corp (SBY)
Colony Capital (NYSE: CLNY) and Silver Bay Realty Trust Corp (NYSE:SBY) are both financials companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, risk, dividends, analyst recommendations, profitability, institutional ownership and earnings.
Colony Capital pays an annual dividend of $1.60 per share and has a dividend yield of 7.4%. Silver Bay Realty Trust Corp pays an annual dividend of $0.52 per share and has a dividend yield of 2.4%. Colony Capital pays out 179.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Silver Bay Realty Trust Corp pays out -325.0% of its earnings in the form of a dividend. Colony Capital has increased its dividend for 7 consecutive years and Silver Bay Realty Trust Corp has increased its dividend for 3 consecutive years. Colony Capital is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings and Valuation
This table compares Colony Capital and Silver Bay Realty Trust Corp’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Silver Bay Realty Trust Corp||N/A||N/A||N/A||($0.16)||-134.31|
Silver Bay Realty Trust Corp is trading at a lower price-to-earnings ratio than Colony Capital, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of recent ratings and price targets for Colony Capital and Silver Bay Realty Trust Corp, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Silver Bay Realty Trust Corp||0||3||0||0||2.00|
Colony Capital presently has a consensus price target of $27.50, suggesting a potential upside of 27.79%. Silver Bay Realty Trust Corp has a consensus price target of $20.25, suggesting a potential downside of 5.77%. Given Colony Capital’s stronger consensus rating and higher possible upside, research analysts clearly believe Colony Capital is more favorable than Silver Bay Realty Trust Corp.
Volatility & Risk
Colony Capital has a beta of 0.75, meaning that its stock price is 25% less volatile than the S&P 500. Comparatively, Silver Bay Realty Trust Corp has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500.
Institutional & Insider Ownership
94.1% of Colony Capital shares are owned by institutional investors. Comparatively, 73.6% of Silver Bay Realty Trust Corp shares are owned by institutional investors. 17.7% of Colony Capital shares are owned by insiders. Comparatively, 7.3% of Silver Bay Realty Trust Corp shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
This table compares Colony Capital and Silver Bay Realty Trust Corp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Silver Bay Realty Trust Corp||-5.71%||-1.42%||-0.61%|
Colony Capital beats Silver Bay Realty Trust Corp on 12 of the 13 factors compared between the two stocks.
About Colony Capital
Colony Capital, Inc., formerly Colony Financial, Inc., is a global real estate and investment management company. The Company operates through five segments: Real Estate Equity, including Light industrial real estate assets and operating platform; Single-family residential rentals through an investment in Colony Starwood Homes and Other real estate equity investments; Real Estate Debt, which includes loan originations and acquisitions, and Investment Management, which includes investment management of the Company-sponsored funds and other investment vehicles. Through its global investment management business, it has over $18.8 billion of assets under management. Its business objective is to provide risk-adjusted returns to its investors through a diversified portfolio of direct and indirect real estate-related equity and real estate debt investments, and fee bearing management contracts on investment funds that it manages.
About Silver Bay Realty Trust Corp
Silver Bay Realty Trust Corp. is a real estate investment trust. It focuses on the acquisition, renovation, leasing and management of single-family properties in select markets in the United States. As of December 31, 2016, it had owned 9,044 single-family properties in Arizona, California, Florida, Georgia, Nevada, North Carolina, Ohio, South Carolina and Texas. Its investments in real estate consist of single-family properties located in various select markets, including Atlanta, Phoenix, Tampa, Charlotte, Orlando, Dallas, Jacksonville, Northern California, Las Vegas, Columbus, Tucson and Southeast Florida. The Charlotte market includes properties in South Carolina due to its proximity to Charlotte, North Carolina. The Northern California market consists of Contra Costa, Napa and Solano counties. The Southeast Florida market consists of Miami-Dade, Broward and Palm Beach counties. It conducts business and owns all of its properties through Silver Bay Operating Partnership L.P.
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