HFF (NYSE: HF) and Reis (NASDAQ:REIS) are both small-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, dividends, risk, earnings and valuation.

Analyst Ratings

This is a summary of recent recommendations and price targets for HFF and Reis, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
HFF 1 2 1 0 2.00
Reis 0 0 2 0 3.00

HFF presently has a consensus target price of $28.00, suggesting a potential downside of 32.35%. Reis has a consensus target price of $24.50, suggesting a potential upside of 29.29%. Given Reis’ stronger consensus rating and higher possible upside, analysts clearly believe Reis is more favorable than HFF.

Risk & Volatility

HFF has a beta of 1.18, suggesting that its share price is 18% more volatile than the S&P 500. Comparatively, Reis has a beta of 1.12, suggesting that its share price is 12% more volatile than the S&P 500.

Earnings and Valuation

This table compares HFF and Reis’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
HFF $542.82 million 2.94 $84.87 million $2.20 18.81
Reis $46.93 million 4.65 $6.64 million $0.10 189.52

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

Institutional & Insider Ownership

87.1% of HFF shares are owned by institutional investors. Comparatively, 59.7% of Reis shares are owned by institutional investors. 5.7% of HFF shares are owned by insiders. Comparatively, 21.6% of Reis shares are owned by 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.

Dividends

Reis pays an annual dividend of $0.68 per share and has a dividend yield of 3.6%. HFF does not pay a dividend. Reis pays out 680.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares HFF and Reis’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
HFF 15.51% 40.20% 8.06%
Reis 2.49% 1.20% 0.92%

Summary

HFF beats Reis on 9 of the 16 factors compared between the two stocks.

About HFF

HFF, Inc. is a holding company. The Company holds the partnership interests in Holliday Fenoglio Fowler, L.P. and HFF Securities L.P. (together, the Operating Partnerships), held through the subsidiary HFF Partnership Holdings, LLC, and all of the outstanding shares of Holliday GP Corp. (Holliday GP). The Company operates through the commercial real estate financial intermediary segment. It offers debt placement, investment sales, distressed debt and real estate owned advisory services, equity placement, investment banking and advisory services, loan sales and commercial loan servicing. Its fully-integrated national capital markets platform, coupled with its knowledge of the commercial real estate markets provides an range of capital markets services, including Debt placement; Investment sales; Distressed debt and real estate owned advisory services; Equity placement; Investment banking and advisory services; Loan sales; and Commercial loan servicing.

About Reis

Reis, Inc. (Reis) is engaged in providing commercial real estate market information and analytical tools to real estate professionals, through its Reis Services subsidiary. The Company operates through Reis Services segment. It maintains a database containing detailed information on commercial properties in metropolitan markets and neighborhoods throughout the United States. The database contains information on apartment, office, retail, warehouse or distribution, flex or research and development, self-storage and seniors housing properties, and is used by real estate investors, lenders and other professionals to make informed buying, selling and financing decisions. Its product portfolio includes Reis Subscriber Edition (SE), its delivery platform aimed at larger and mid-sized enterprises; ReisReports, aimed at prosumers and smaller enterprises, and Mobiuss Portfolio CRE (Mobiuss), aimed at risk managers and credit administrators at banks and non-bank lending institutions.

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