Critical Analysis: SouFun Holdings Limited (SFUN) versus Landmark Infrastructure Partners (LMRK)

SouFun Holdings Limited (NYSE: SFUN) and Landmark Infrastructure Partners (NASDAQ:LMRK) are both small-cap business services companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, profitability, valuation, earnings, risk and dividends.

Insider & Institutional Ownership

46.9% of SouFun Holdings Limited shares are owned by institutional investors. Comparatively, 20.6% of Landmark Infrastructure Partners shares are owned by institutional investors. 0.7% of Landmark Infrastructure Partners shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Dividends

Landmark Infrastructure Partners pays an annual dividend of $1.42 per share and has a dividend yield of 8.2%. SouFun Holdings Limited does not pay a dividend. Landmark Infrastructure Partners pays out 263.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Volatility & Risk

SouFun Holdings Limited has a beta of 1.25, indicating that its stock price is 25% more volatile than the S&P 500. Comparatively, Landmark Infrastructure Partners has a beta of 0.43, indicating that its stock price is 57% less volatile than the S&P 500.

Profitability

This table compares SouFun Holdings Limited and Landmark Infrastructure Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SouFun Holdings Limited -4.57% -8.80% -2.74%
Landmark Infrastructure Partners 26.38% 9.69% 2.65%

Analyst Ratings

This is a summary of current ratings and recommmendations for SouFun Holdings Limited and Landmark Infrastructure Partners, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SouFun Holdings Limited 2 3 2 0 2.00
Landmark Infrastructure Partners 0 0 2 0 3.00

SouFun Holdings Limited currently has a consensus price target of $3.63, indicating a potential downside of 17.59%. Landmark Infrastructure Partners has a consensus price target of $18.50, indicating a potential upside of 6.94%. Given Landmark Infrastructure Partners’ stronger consensus rating and higher probable upside, analysts clearly believe Landmark Infrastructure Partners is more favorable than SouFun Holdings Limited.

Earnings & Valuation

This table compares SouFun Holdings Limited and Landmark Infrastructure Partners’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
SouFun Holdings Limited $644.69 million 2.97 $9.32 million ($0.06) -73.33
Landmark Infrastructure Partners $47.53 million 8.33 $38.35 million $0.54 32.04

Landmark Infrastructure Partners has higher revenue, but lower earnings than SouFun Holdings Limited. SouFun Holdings Limited is trading at a lower price-to-earnings ratio than Landmark Infrastructure Partners, indicating that it is currently the more affordable of the two stocks.

Summary

Landmark Infrastructure Partners beats SouFun Holdings Limited on 10 of the 14 factors compared between the two stocks.

About SouFun Holdings Limited

Fang Holdings Limited, formerly SouFun Holdings Limited, operates as a real estate Internet portal in China. The Company’s Websites and mobile applications support active online communities and networks of users seeking information on, and services for, the real estate and home-related sectors in China. The Company, through its Internet platform, is engaged in the development of transaction and financing platforms by offering direct sales services for new homes, online real estate brokerage services and financial services. The Company’s service offerings include marketing services, E-commerce services, listing services, Financial services and other value-added services. The Company provides secured loans in the form of entrusted loans and mortgage loans and unsecured loans primarily to home buyers, real estate developers and other borrowers that meet its credit assessment requirements.

About Landmark Infrastructure Partners

Landmark Infrastructure Partners LP is a master limited partnership formed to acquire, own and manage a portfolio of real property interests that it leases to companies in the wireless communication, outdoor advertising and renewable power generation industries. The Company operates through three segments. The Wireless Communication segment consists of leasing real property interests and financing to companies in the wireless communication industry in the United States. The Outdoor Advertising segment consists of leasing real property interests to companies in the outdoor advertising industry in the United States. The Renewable Power Generation segment consists of leasing real property interests and financing to companies in the renewable power industry in the United States. The Company’s real property interests consist of a portfolio of long term and perpetual easements, tenant lease assignments and fee simple properties located primarily in the United States.

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