Financial Survey: Great Ajax Corp. (AJX) and Manhattan Bridge Capital (LOAN)
Great Ajax Corp. (NYSE: AJX) and Manhattan Bridge Capital (NASDAQ:LOAN) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, valuation, earnings, dividends, institutional ownership, risk and analyst recommendations.
Great Ajax Corp. pays an annual dividend of $1.20 per share and has a dividend yield of 8.5%. Manhattan Bridge Capital pays an annual dividend of $0.41 per share and has a dividend yield of 7.1%. Great Ajax Corp. pays out 76.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. 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. Great Ajax Corp. is clearly the better dividend stock, given its higher yield and lower payout ratio.
This is a summary of recent ratings and recommmendations for Great Ajax Corp. and Manhattan Bridge Capital, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Great Ajax Corp.||0||2||2||0||2.50|
|Manhattan Bridge Capital||0||0||1||0||3.00|
Great Ajax Corp. currently has a consensus target price of $15.13, suggesting a potential upside of 7.04%. Manhattan Bridge Capital has a consensus target price of $7.25, suggesting a potential upside of 25.00%. Given Manhattan Bridge Capital’s stronger consensus rating and higher possible upside, analysts clearly believe Manhattan Bridge Capital is more favorable than Great Ajax Corp..
This table compares Great Ajax Corp. and Manhattan Bridge Capital’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Great Ajax Corp.||58.46%||10.22%||3.02%|
|Manhattan Bridge Capital||59.95%||13.39%||8.37%|
Earnings & Valuation
This table compares Great Ajax Corp. and Manhattan Bridge Capital’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Great Ajax Corp.||$50.65 million||4.92||$27.67 million||$1.57||9.00|
|Manhattan Bridge Capital||$4.21 million||11.16||$3.08 million||$0.38||15.26|
Great Ajax Corp. has higher revenue and earnings than Manhattan Bridge Capital. Great Ajax Corp. 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.
Institutional & Insider Ownership
75.3% of Great Ajax Corp. shares are owned by institutional investors. Comparatively, 11.4% of Manhattan Bridge Capital shares are owned by institutional investors. 3.8% of Great Ajax Corp. shares are owned by company insiders. Comparatively, 32.3% of Manhattan Bridge Capital shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Volatility and Risk
Great Ajax Corp. has a beta of 0.87, suggesting that its stock price is 13% less volatile than the S&P 500. Comparatively, Manhattan Bridge Capital has a beta of 0.81, suggesting that its stock price is 19% less volatile than the S&P 500.
About Great Ajax Corp.
Great Ajax Corp. is an externally managed real estate company. The Company is focused on acquiring, investing in and managing a portfolio of re-performing and non-performing mortgage loans secured by single-family residences and single-family properties. Its segment is focused on non-performing mortgages and re-performing mortgages. It also invests in loans secured by multi-family residential and commercial mixed use retail/residential properties, as well as in the properties directly. It also holds real estate-owned properties (REO) acquired upon the foreclosure or other settlement of its owned non-performing loans, as well as through outright purchases. It is managed by Thetis Asset Management LLC, an affiliated entity. Its mortgage loans and other real estate assets are serviced by Gregory Funding LLC, an affiliated entity. The Company conducts its business through its operating partnership, Great Ajax Operating Partnership L.P.
About Manhattan Bridge Capital
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.
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