Reviewing Manhattan Bridge Capital (LOAN) & Ellington Residential Mortgage REIT (NYSE:EARN)
Manhattan Bridge Capital (NASDAQ: LOAN) and Ellington Residential Mortgage REIT (NYSE:EARN) are both small-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.
Insider and Institutional Ownership
9.6% of Manhattan Bridge Capital shares are owned by institutional investors. Comparatively, 50.2% of Ellington Residential Mortgage REIT shares are owned by institutional investors. 32.3% of Manhattan Bridge Capital shares are owned by company insiders. Comparatively, 2.7% of Ellington Residential Mortgage REIT shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Volatility and Risk
Manhattan Bridge Capital has a beta of 0.79, meaning that its share price is 21% less volatile than the S&P 500. Comparatively, Ellington Residential Mortgage REIT has a beta of 0.63, meaning that its share price is 37% less volatile than the S&P 500.
Manhattan Bridge Capital pays an annual dividend of $0.41 per share and has a dividend yield of 7.4%. Ellington Residential Mortgage REIT pays an annual dividend of $1.60 per share and has a dividend yield of 11.2%. Manhattan Bridge Capital pays out 107.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ellington Residential Mortgage REIT pays out 121.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
This table compares Manhattan Bridge Capital and Ellington Residential Mortgage REIT’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Manhattan Bridge Capital||59.95%||13.39%||8.37%|
|Ellington Residential Mortgage REIT||44.93%||12.25%||1.18%|
This is a summary of recent ratings and recommmendations for Manhattan Bridge Capital and Ellington Residential Mortgage REIT, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Manhattan Bridge Capital||0||0||1||0||3.00|
|Ellington Residential Mortgage REIT||0||2||0||0||2.00|
Manhattan Bridge Capital currently has a consensus target price of $7.25, suggesting a potential upside of 30.63%. Ellington Residential Mortgage REIT has a consensus target price of $14.00, suggesting a potential downside of 1.62%. Given Manhattan Bridge Capital’s stronger consensus rating and higher possible upside, analysts plainly believe Manhattan Bridge Capital is more favorable than Ellington Residential Mortgage REIT.
Valuation & Earnings
This table compares Manhattan Bridge Capital and Ellington Residential Mortgage REIT’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Manhattan Bridge Capital||$4.21 million||10.68||$3.08 million||$0.38||14.61|
|Ellington Residential Mortgage REIT||$35.93 million||5.23||$17.43 million||$1.32||10.78|
Ellington Residential Mortgage REIT has higher revenue and earnings than Manhattan Bridge Capital. Ellington Residential Mortgage REIT is trading at a lower price-to-earnings ratio than Manhattan Bridge Capital, indicating that it is currently the more affordable of the two stocks.
Manhattan Bridge Capital beats Ellington Residential Mortgage REIT on 11 of the 16 factors compared between the two stocks.
Manhattan Bridge Capital Company Profile
Manhattan Bridge Capital, Inc. (MBC) is a real estate finance company that specializes in originating, servicing and managing a portfolio of first mortgage loans. The Company offers short-term, secured, non-banking loans to real estate investors to fund their acquisition, renovation, rehabilitation or improvement of properties located in the New York metropolitan area. Its primary business objective is to grow its loan portfolio while protecting and preserving capital in a manner that provides for risk-adjusted returns to its shareholders over the long term through dividends. It intends to achieve this objective by continuing to selectively originate, fund loans secured by first mortgages on residential real estate held for investment located in the New York metropolitan area, and to manage and service its portfolio in a manner designed to generate risk-adjusted returns across a range of market conditions and economic cycles. Its loan portfolio includes various construction loans.
Ellington Residential Mortgage REIT Company Profile
Ellington Residential Mortgage REIT is a real estate investment trust. The Company conducts its business through its subsidiaries, EARN OP GP LLC and Ellington Residential Mortgage LP (the Operating Partnership). It specializes in acquiring, investing in and managing residential mortgage- and real estate-related assets. It constructs and managing a portfolio consisting of residential mortgage-backed securities (RMBS) for which the principal and interest payments are guaranteed by the United States Government agency or the United States Government-sponsored entity (Agency RMBS) and, to a lesser extent, RMBS backed by prime jumbo, Alternative A-paper manufactured housing, and subprime residential mortgage loans (non-Agency RMBS). Its Agency RMBS include residential mortgage pass-through certificates, collateralized mortgage obligations (CMOs) and to-be-announced mortgage pass-through certificates (TBAs). Its non-agency RMBS include investment grade and non-investment grade classes.
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