Western Asset Mortgage Capital (NYSE:WMC) and RAIT Financial Trust (OTCMKTS:RASF) are both small-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, institutional ownership, risk, analyst recommendations, dividends, valuation and profitability.
This is a breakdown of current ratings and price targets for Western Asset Mortgage Capital and RAIT Financial Trust, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Western Asset Mortgage Capital||0||0||0||0||N/A|
|RAIT Financial Trust||0||0||0||0||N/A|
This table compares Western Asset Mortgage Capital and RAIT Financial Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Western Asset Mortgage Capital||11.98%||11.97%||1.14%|
|RAIT Financial Trust||-144.12%||-74.38%||-7.03%|
Valuation and Earnings
This table compares Western Asset Mortgage Capital and RAIT Financial Trust’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Western Asset Mortgage Capital||$209.36 million||2.42||$26.41 million||$1.36||7.73|
|RAIT Financial Trust||$99.71 million||0.03||-$151.87 million||N/A||N/A|
Western Asset Mortgage Capital has higher revenue and earnings than RAIT Financial Trust.
Western Asset Mortgage Capital pays an annual dividend of $1.24 per share and has a dividend yield of 11.8%. RAIT Financial Trust does not pay a dividend. Western Asset Mortgage Capital pays out 91.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Volatility & Risk
Western Asset Mortgage Capital has a beta of 0.73, suggesting that its stock price is 27% less volatile than the S&P 500. Comparatively, RAIT Financial Trust has a beta of 5.84, suggesting that its stock price is 484% more volatile than the S&P 500.
Insider & Institutional Ownership
46.9% of Western Asset Mortgage Capital shares are held by institutional investors. Comparatively, 0.1% of RAIT Financial Trust shares are held by institutional investors. 0.5% of Western Asset Mortgage Capital shares are held by insiders. Comparatively, 1.9% of RAIT Financial Trust shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Western Asset Mortgage Capital beats RAIT Financial Trust on 8 of the 11 factors compared between the two stocks.
Western Asset Mortgage Capital Company Profile
Western Asset Mortgage Capital Corporation operates as a real estate investment trust in the United States. It focuses on investing in, financing, and managing a portfolio of agency and non-agency residential mortgage-backed securities and commercial mortgage-backed securities, residential whole-loans, residential bridge loans, securitized commercial loans, and other financial assets. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was founded in 2009 and is based in Pasadena, California.
RAIT Financial Trust Company Profile
RAIT Financial Trust is an internally-managed real estate investment trust focused on providing debt financing options to owners of commercial real estate throughout the United States.
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