Granite Point Mortgage Trust (NYSE:GPMT – Get Free Report) and Chicago Atlantic Real Estate Finance (NASDAQ:REFI – Get Free Report) are both small-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, dividends, risk, institutional ownership, valuation, profitability and analyst recommendations.
Profitability
This table compares Granite Point Mortgage Trust and Chicago Atlantic Real Estate Finance’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Granite Point Mortgage Trust | -87.21% | 0.95% | 0.27% |
| Chicago Atlantic Real Estate Finance | 64.57% | 13.17% | 10.10% |
Dividends
Granite Point Mortgage Trust pays an annual dividend of $0.20 per share and has a dividend yield of 6.2%. Chicago Atlantic Real Estate Finance pays an annual dividend of $1.88 per share and has a dividend yield of 11.7%. Granite Point Mortgage Trust pays out -5.2% of its earnings in the form of a dividend. Chicago Atlantic Real Estate Finance pays out 94.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Granite Point Mortgage Trust | 0 | 2 | 2 | 0 | 2.50 |
| Chicago Atlantic Real Estate Finance | 0 | 0 | 2 | 1 | 3.33 |
Granite Point Mortgage Trust presently has a consensus target price of $4.58, suggesting a potential upside of 43.01%. Chicago Atlantic Real Estate Finance has a consensus target price of $20.00, suggesting a potential upside of 24.30%. Given Granite Point Mortgage Trust’s higher probable upside, research analysts plainly believe Granite Point Mortgage Trust is more favorable than Chicago Atlantic Real Estate Finance.
Earnings and Valuation
This table compares Granite Point Mortgage Trust and Chicago Atlantic Real Estate Finance”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Granite Point Mortgage Trust | $47.59 million | 3.36 | -$63.20 million | ($3.86) | -0.83 |
| Chicago Atlantic Real Estate Finance | $57.15 million | 5.53 | $38.71 million | $2.00 | 8.05 |
Chicago Atlantic Real Estate Finance has higher revenue and earnings than Granite Point Mortgage Trust. Granite Point Mortgage Trust is trading at a lower price-to-earnings ratio than Chicago Atlantic Real Estate Finance, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
51.6% of Granite Point Mortgage Trust shares are owned by institutional investors. Comparatively, 25.5% of Chicago Atlantic Real Estate Finance shares are owned by institutional investors. 2.3% of Granite Point Mortgage Trust shares are owned by insiders. Comparatively, 12.3% of Chicago Atlantic Real Estate Finance shares are owned by 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.
Risk and Volatility
Granite Point Mortgage Trust has a beta of 1.83, indicating that its share price is 83% more volatile than the S&P 500. Comparatively, Chicago Atlantic Real Estate Finance has a beta of 0.23, indicating that its share price is 77% less volatile than the S&P 500.
Summary
Chicago Atlantic Real Estate Finance beats Granite Point Mortgage Trust on 12 of the 16 factors compared between the two stocks.
About Granite Point Mortgage Trust
Granite Point Mortgage Trust Inc., a real estate investment trust, originates, invests in, and manages senior floating-rate commercial mortgage loans, and other debt and debt-like commercial real estate investments in the United States. The company provides intermediate-term bridge or transitional financing for various purposes, including acquisitions, recapitalizations, and refinancing, as well as a range of business plans, including lease-up, renovation, repositioning, and repurposing of the commercial property. 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 2015 and is headquartered in New York, New York.
About Chicago Atlantic Real Estate Finance
Chicago Atlantic Real Estate Finance, Inc. operates as a commercial real estate finance company in the United States. The company engages in originating, structuring, and investing in first mortgage loans and alternative structured financings secured by commercial real estate properties. Its portfolio primarily includes offers senior loans to state-licensed operators in the cannabis industry. The company has elected to be taxed as a real estate investment trust (REIT) and would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. Chicago Atlantic Real Estate Finance, Inc. was incorporated in 2021 and is headquartered in Chicago, Illinois.
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