Financial Review: Orion Office REIT (NYSE:ONL) versus Equinix (NASDAQ:EQIX)

Orion Office REIT (NYSE:ONL) and Equinix (NASDAQ:EQIX) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, institutional ownership, earnings, dividends, analyst recommendations, valuation and profitability.

Profitability

This table compares Orion Office REIT and Equinix’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Orion Office REIT	-51.47%	-10.69%	-6.56%
Equinix	12.29%	8.55%	3.25%

Analyst Ratings

This is a summary of current ratings and price targets for Orion Office REIT and Equinix, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Orion Office REIT	0	1	0	0	2.00
Equinix	0	5	14	1	2.80

Equinix has a consensus price target of $944.63, indicating a potential upside of 6.34%. Given Equinix’s stronger consensus rating and higher probable upside, analysts plainly believe Equinix is more favorable than Orion Office REIT.

Dividends

Orion Office REIT pays an annual dividend of $0.40 per share and has a dividend yield of 10.8%. Equinix pays an annual dividend of $17.04 per share and has a dividend yield of 1.9%. Orion Office REIT pays out -24.2% of its earnings in the form of a dividend. Equinix pays out 153.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Orion Office REIT is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

Orion Office REIT has a beta of 0.99, suggesting that its stock price is 1% less volatile than the S&P 500. Comparatively, Equinix has a beta of 0.71, suggesting that its stock price is 29% less volatile than the S&P 500.

Earnings and Valuation

This table compares Orion Office REIT and Equinix”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Orion Office REIT	$195.04 million	1.07	-$57.30 million	($1.65)	-2.25
Equinix	$8.19 billion	10.30	$969.18 million	$11.09	80.10

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

Insider & Institutional Ownership

80.0% of Orion Office REIT shares are owned by institutional investors. Comparatively, 94.9% of Equinix shares are owned by institutional investors. 0.2% of Orion Office REIT shares are owned by company insiders. Comparatively, 0.3% of Equinix shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Equinix beats Orion Office REIT on 13 of the 16 factors compared between the two stocks.

About Orion Office REIT

Orion Office REIT specializes in the ownership, acquisition and management of a diversified portfolio of mission-critical and corporate headquarters office buildings in high-quality suburban markets across the U.S. The portfolio is leased primarily on a single-tenant net lease basis to creditworthy tenants. The company's team of experienced industry leaders employs a proven, cycle-tested investment evaluation framework which serves as the lens through which capital allocation decisions are made for the current portfolio and future acquisitions.

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.