Annaly Capital Management (NLY) and KKR Real Estate Finance Trust (KREF) Critical Comparison

Annaly Capital Management (NYSE: NLY) and KKR Real Estate Finance Trust (NYSE:KREF) are both financials companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, dividends, risk, profitability, analyst recommendations, earnings and institutional ownership.

Analyst Recommendations

This is a summary of recent recommendations for Annaly Capital Management and KKR Real Estate Finance Trust, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Annaly Capital Management 0 3 2 0 2.40
KKR Real Estate Finance Trust 1 2 1 0 2.00

Annaly Capital Management presently has a consensus target price of $11.63, suggesting a potential upside of 15.21%. KKR Real Estate Finance Trust has a consensus target price of $22.50, suggesting a potential upside of 21.49%. Given KKR Real Estate Finance Trust’s higher probable upside, analysts clearly believe KKR Real Estate Finance Trust is more favorable than Annaly Capital Management.

Profitability

This table compares Annaly Capital Management and KKR Real Estate Finance Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Annaly Capital Management 104.56% 11.59% 1.52%
KKR Real Estate Finance Trust 77.41% 6.08% 0.75%

Valuation & Earnings

This table compares Annaly Capital Management and KKR Real Estate Finance Trust’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Annaly Capital Management $2.21 billion 5.29 $1.43 billion $2.50 4.04
KKR Real Estate Finance Trust $41.19 million 24.14 $31.15 million N/A N/A

Annaly Capital Management has higher revenue and earnings than KKR Real Estate Finance Trust.

Dividends

Annaly Capital Management pays an annual dividend of $1.20 per share and has a dividend yield of 11.9%. KKR Real Estate Finance Trust pays an annual dividend of $1.48 per share and has a dividend yield of 8.0%. Annaly Capital Management pays out 48.0% of its earnings in the form of a dividend.

Institutional and Insider Ownership

55.1% of Annaly Capital Management shares are held by institutional investors. Comparatively, 65.7% of KKR Real Estate Finance Trust shares are held by institutional investors. 0.4% of Annaly Capital Management shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Annaly Capital Management beats KKR Real Estate Finance Trust on 9 of the 13 factors compared between the two stocks.

Annaly Capital Management Company Profile

Annaly Capital Management, Inc. is a mortgage real estate investment trust (REIT). The Company owns a portfolio of real estate related investments. Its investment groups primarily consist of Agency, which invests primarily in various types of Agency mortgage-backed securities and related derivatives to hedge these investments; Residential credit, which invests primarily in non-Agency mortgage-backed assets within securitized products and residential mortgage loan markets; Commercial real estate, which originates and invests in commercial mortgage loans, securities, and other commercial real estate investments, and Middle market, which provides customized debt financing to middle-market businesses. Its business operations consist of Annaly Commercial Real Estate Group, Inc., which is its subsidiary that specializes in originating or acquiring, financing and managing commercial loans and other commercial real estate debt; Annaly Middle Market Lending LLC, and RCap Securities, Inc.

KKR Real Estate Finance Trust Company Profile

KKR Real Estate Finance Trust Inc is a real estate finance company that focuses primarily on originating and acquiring senior mortgage loans secured by commercial real estate assets (CRE). KKR manages investments across multiple asset classes, including private equity, real estate, energy, infrastructure, credit and hedge funds. The Company’s investment strategy is to originate or acquire senior mortgage loans collateralized by institutional-quality CRE assets. Its target assets also include mezzanine loans, preferred equity and other debt-oriented instruments. The Company’s investment objective is capital preservation and generating attractive risk-adjusted returns for its stockholders over the long term, primarily through dividends.

Receive News & Ratings for Annaly Capital Management Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Annaly Capital Management and related companies with MarketBeat.com's FREE daily email newsletter.

Leave a Reply