Equinix (NASDAQ:EQIX) & Gladstone Land (NASDAQ:LAND) Critical Analysis

Gladstone Land (NASDAQ:LAND) and Equinix (NASDAQ:EQIX) are both real estate companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, dividends, risk, profitability, analyst recommendations and institutional ownership.

Profitability

This table compares Gladstone Land and Equinix’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Gladstone Land	-7.31%	-0.96%	-0.53%
Equinix	15.64%	10.76%	3.83%

Dividends

Gladstone Land pays an annual dividend of $0.56 per share and has a dividend yield of 6.4%. Equinix pays an annual dividend of $20.64 per share and has a dividend yield of 1.9%. Gladstone Land pays out -101.8% of its earnings in the form of a dividend. Equinix pays out 132.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Gladstone Land has increased its dividend for 2 consecutive years and Equinix has increased its dividend for 10 consecutive years. Gladstone Land is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a breakdown of current ratings and price targets for Gladstone Land and Equinix, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gladstone Land	1	2	0	1	2.25
Equinix	0	4	21	2	2.93

Gladstone Land presently has a consensus target price of $10.00, indicating a potential upside of 14.88%. Equinix has a consensus target price of $1,203.40, indicating a potential upside of 12.08%. Given Gladstone Land’s higher probable upside, analysts plainly believe Gladstone Land is more favorable than Equinix.

Risk and Volatility

Gladstone Land has a beta of 1.07, indicating that its stock price is 7% more volatile than the S&P 500. Comparatively, Equinix has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500.

Insider and Institutional Ownership

53.6% of Gladstone Land shares are held by institutional investors. Comparatively, 94.9% of Equinix shares are held by institutional investors. 6.1% of Gladstone Land shares are held by company insiders. Comparatively, 0.3% of Equinix shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Gladstone Land and Equinix”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gladstone Land	$88.48 million	4.24	$13.53 million	($0.55)	-15.83
Equinix	$9.80 billion	10.80	$1.35 billion	$15.53	69.13

Equinix has higher revenue and earnings than Gladstone Land. Gladstone Land is trading at a lower price-to-earnings ratio than Equinix, indicating that it is currently the more affordable of the two stocks.

Summary

Equinix beats Gladstone Land on 13 of the 18 factors compared between the two stocks.

About Gladstone Land

Founded in 1997, Gladstone Land is a publicly traded real estate investment trust that acquires and owns farmland and farm-related properties located in major agricultural markets in the U.S. and leases its properties to unrelated third-party farmers. The Company, which reports the aggregate fair value of its farmland holdings on a quarterly basis, currently owns 169 farms, comprised of approximately 116,000 acres in 15 different states and over 45,000 acre-feet of banked water in California, valued at a total of approximately $1.6 billion. Gladstone Land’s farms are predominantly located in regions where its tenants are able to grow fresh produce annual row crops, such as berries and vegetables, which are generally planted and harvested annually. The Company also owns farms growing permanent crops, such as almonds, apples, cherries, figs, lemons, olives, pistachios, and other orchards, as well as blueberry groves and vineyards, which are generally planted every 20-plus years and harvested annually. Approximately 40% of the Company’s fresh produce acreage is either organic or in transition to become organic, and over 10% of its permanent crop acreage falls into this category. The Company may also acquire property related to farming, such as cooling facilities, processing buildings, packaging facilities, and distribution centers. Gladstone Land pays monthly distributions to its stockholders and has paid 129 consecutive monthly cash distributions on its common stock since its initial public offering in January 2013. The Company has increased its common distributions 32 times over the prior 35 quarters, and the current per-share distribution on its common stock is $0.0464 per month, or $0.5568 per year.

About Equinix

Equinix (Nasdaq: EQIX) is the world's digital infrastructure company . Digital leaders harness Equinix's trusted platform to bring together and interconnect foundational infrastructure at software speed. Equinix enables organizations to access all the right places, partners and possibilities to scale with agility, speed the launch of digital services, deliver world-class experiences and multiply their value, while supporting their sustainability goals.