Lamar Advertising (NASDAQ:LAMR) vs. OUTFRONT Media (NYSE:OUT) Critical Contrast

OUTFRONT Media (NYSE:OUT) and Lamar Advertising (NASDAQ:LAMR) are both real estate companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, profitability, risk, valuation, earnings, institutional ownership and dividends.

Institutional and Insider Ownership

93.8% of Lamar Advertising shares are owned by institutional investors. 0.4% of OUTFRONT Media shares are owned by insiders. Comparatively, 15.2% of Lamar Advertising shares are owned by 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.

Risk and Volatility

OUTFRONT Media has a beta of 1.53, meaning that its share price is 53% more volatile than the S&P 500. Comparatively, Lamar Advertising has a beta of 1.2, meaning that its share price is 20% more volatile than the S&P 500.

Valuation & Earnings

This table compares OUTFRONT Media and Lamar Advertising”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
OUTFRONT Media	$1.93 billion	2.77	$147.00 million	$1.39	21.84
Lamar Advertising	$2.27 billion	6.73	$587.15 million	$5.48	27.39

Lamar Advertising has higher revenue and earnings than OUTFRONT Media. OUTFRONT Media is trading at a lower price-to-earnings ratio than Lamar Advertising, indicating that it is currently the more affordable of the two stocks.

Dividends

OUTFRONT Media pays an annual dividend of $1.32 per share and has a dividend yield of 4.3%. Lamar Advertising pays an annual dividend of $6.60 per share and has a dividend yield of 4.4%. OUTFRONT Media pays out 95.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Lamar Advertising pays out 120.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Lamar Advertising has raised its dividend for 5 consecutive years. Lamar Advertising is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares OUTFRONT Media and Lamar Advertising’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
OUTFRONT Media	12.66%	37.44%	4.65%
Lamar Advertising	23.90%	54.94%	8.04%

Analyst Recommendations

This is a breakdown of current ratings and price targets for OUTFRONT Media and Lamar Advertising, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
OUTFRONT Media	0	1	6	0	2.86
Lamar Advertising	0	3	2	0	2.40

OUTFRONT Media currently has a consensus target price of $34.00, suggesting a potential upside of 11.99%. Lamar Advertising has a consensus target price of $160.17, suggesting a potential upside of 6.71%. Given OUTFRONT Media’s stronger consensus rating and higher possible upside, analysts clearly believe OUTFRONT Media is more favorable than Lamar Advertising.

Summary

Lamar Advertising beats OUTFRONT Media on 12 of the 17 factors compared between the two stocks.

About OUTFRONT Media

OUTFRONT Media, Inc. leases advertising space on out-of-home advertising structures and sites. Its inventory consists of billboard displays, which are primarily located on the most heavily traveled highways & roadways, and transit advertising displays operated under exclusive multi-year contracts with municipalities in large cities across the U.S. and Canada. It operates through the U.S. Media and other segments. The U.S. Media segment includes U.S. Billboard and Transit. The company was founded in 1938 and is headquartered in New York, NY.

About Lamar Advertising

Lamar Advertising Company operates as an outdoor advertising company in the United States and Canada. The company owns and operates billboards, logo signs, and transit advertising displays, as well as rents space for advertising on billboards, buses, shelters, benches, logo plates, and in airport terminals. Lamar Advertising Company was founded in 1902 and is headquartered in Baton Rouge, Louisiana.