Comparing CatchMark Timber Trust (CTT) and Rayonier (RYN)

CatchMark Timber Trust (NYSE: CTT) and Rayonier (NYSE:RYN) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, dividends, risk, valuation, earnings and institutional ownership.

Profitability

This table compares CatchMark Timber Trust and Rayonier’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CatchMark Timber Trust -15.09% -3.64% -1.90%
Rayonier 17.06% 3.89% 2.19%

Dividends

CatchMark Timber Trust pays an annual dividend of $0.54 per share and has a dividend yield of 4.1%. Rayonier pays an annual dividend of $1.00 per share and has a dividend yield of 3.3%. CatchMark Timber Trust pays out -158.8% of its earnings in the form of a dividend. Rayonier pays out 95.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CatchMark Timber Trust has raised its dividend for 2 consecutive years. CatchMark Timber Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of current recommendations and price targets for CatchMark Timber Trust and Rayonier, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CatchMark Timber Trust 0 0 1 0 3.00
Rayonier 0 3 2 0 2.40

CatchMark Timber Trust currently has a consensus price target of $12.50, indicating a potential downside of 4.21%. Rayonier has a consensus price target of $30.00, indicating a potential downside of 2.38%. Given Rayonier’s higher probable upside, analysts clearly believe Rayonier is more favorable than CatchMark Timber Trust.

Valuation and Earnings

This table compares CatchMark Timber Trust and Rayonier’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CatchMark Timber Trust $81.86 million 6.92 -$11.07 million ($0.34) -38.38
Rayonier $788.30 million 5.03 $211.97 million $1.05 29.27

Rayonier has higher revenue and earnings than CatchMark Timber Trust. CatchMark Timber Trust is trading at a lower price-to-earnings ratio than Rayonier, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

CatchMark Timber Trust has a beta of 0.69, meaning that its stock price is 31% less volatile than the S&P 500. Comparatively, Rayonier has a beta of 0.39, meaning that its stock price is 61% less volatile than the S&P 500.

Institutional and Insider Ownership

63.7% of CatchMark Timber Trust shares are owned by institutional investors. Comparatively, 83.4% of Rayonier shares are owned by institutional investors. 1.2% of CatchMark Timber Trust shares are owned by company insiders. Comparatively, 0.6% of Rayonier shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Rayonier beats CatchMark Timber Trust on 9 of the 16 factors compared between the two stocks.

CatchMark Timber Trust Company Profile

CatchMark Timber Trust, Inc. is a real estate company investing in timberlands. The Company primarily engages in the ownership, management, acquisition and disposition of timberlands located in the United States. It is focused on investing in timberlands and to manage such assets to provide current income and attractive long-term returns to its stockholders. It owns all its properties and other investments through its operating partnership. The Company generates its income from the harvest and sale of timber, as well as from non-timber related revenue sources, such as recreational leases. In April 2014, the Company acquired 36,300 acres of timberland (known as the Waycross-Panola properties) located in Southeast Georgia and East Texas from Hancock Timber Resource Group. Approximately 55,600 acres of prime timberlands, known as Oglethorpe and Satilla River, add 2.7 million tons of timber to the Company’s merchantable inventory.

Rayonier Company Profile

Rayonier Inc. is a timberland real estate investment trust with assets located in some of the timber growing regions in the United States and New Zealand. The Company operates through five segments: Southern Timber, Pacific Northwest Timber, New Zealand Timber, Real Estate and Trading. The Southern Timber, Pacific Northwest Timber and New Zealand Timber segments reflect all activities related to the harvesting of timber and other activities, such as recreational leases, within each respective geography. Its New Zealand Timber segment also reflects land sales that occur within its New Zealand portfolio. Its Real Estate segment reflects the United States land sales. Its Trading segment reflects the log trading activities that support its New Zealand operations. It owned, leased or managed approximately 2.7 million acres of timberlands, as of December 31, 2016. It is engaged in the trading of logs from New Zealand and Australia to Pacific Rim markets.

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