Analyzing InterDigital (IDCC) & SBA Communications (SBAC)
InterDigital (NASDAQ: IDCC) and SBA Communications (NASDAQ:SBAC) are both computer and technology companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, profitability, valuation, analyst recommendations, earnings, risk and institutional ownership.
This table compares InterDigital and SBA Communications’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent ratings for InterDigital and SBA Communications, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
InterDigital presently has a consensus price target of $90.50, suggesting a potential upside of 21.97%. SBA Communications has a consensus price target of $173.42, suggesting a potential upside of 3.79%. Given InterDigital’s stronger consensus rating and higher probable upside, equities research analysts clearly believe InterDigital is more favorable than SBA Communications.
Risk and Volatility
InterDigital has a beta of 0.99, indicating that its share price is 1% less volatile than the S&P 500. Comparatively, SBA Communications has a beta of 0.92, indicating that its share price is 8% less volatile than the S&P 500.
Earnings & Valuation
This table compares InterDigital and SBA Communications’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|InterDigital||$532.94 million||4.82||$174.29 million||$4.87||15.24|
|SBA Communications||$1.73 billion||11.27||$103.65 million||$0.86||194.29|
InterDigital has higher earnings, but lower revenue than SBA Communications. InterDigital is trading at a lower price-to-earnings ratio than SBA Communications, indicating that it is currently the more affordable of the two stocks.
InterDigital pays an annual dividend of $1.40 per share and has a dividend yield of 1.9%. SBA Communications does not pay a dividend. InterDigital pays out 28.7% of its earnings in the form of a dividend.
Insider & Institutional Ownership
74.2% of InterDigital shares are held by institutional investors. Comparatively, 92.9% of SBA Communications shares are held by institutional investors. 1.9% of InterDigital shares are held by insiders. Comparatively, 2.4% of SBA Communications shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
InterDigital beats SBA Communications on 9 of the 16 factors compared between the two stocks.
InterDigital, Inc. designs and develops technologies for wireless communications. The Company is focused on three technology areas: cellular wireless technology, Internet of things (IoT) technology, and, through its Hillcrest Laboratories, Inc. (Hillcrest Labs) subsidiary, sensor and sensor fusion technology. It offers a range of technologies that are used in digital cellular and wireless products and networks, including second generation (2G), third generation (3G), fourth generation (4G) and IEEE 802-related products and networks. Products incorporating its inventions include mobile devices, such as cellular phones, tablets, notebook computers and wireless personal digital assistants; wireless infrastructure equipment, such as base stations; components, dongles and modules for wireless devices, and IoT devices and software platforms. The Company is developing a range of technologies in the areas of video compression and delivery, security, analytics, and other areas.
About SBA Communications
SBA Communications Corporation is an independent owner and operator of wireless communications tower structures, rooftops and other structures that support antennas used for wireless communications. The Company’s operating segments include site leasing and site development. The site leasing business includes segments, domestic site leasing and international site leasing. The Company’s primary business line is its site leasing business. In its site leasing business, the Company leases antenna space to wireless service providers on towers that it owns or operates, and manages rooftop and tower sites for property owners under various contractual arrangements. The Company owns approximately 25,460 towers. It also manages or leases approximately 5,500 actual or potential towers. The Company’s other business line is its site development business, through which it assists wireless service providers in developing and maintaining their own wireless service networks.
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