Dynex Capital (NYSE: DX) and AG Mortgage Investment Trust (NYSE:MITT) are both small-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, earnings, profitability, institutional ownership, risk, valuation and analyst recommendations.
This is a breakdown of recent ratings and target prices for Dynex Capital and AG Mortgage Investment Trust, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|AG Mortgage Investment Trust||0||3||0||0||2.00|
Dynex Capital presently has a consensus target price of $7.25, indicating a potential upside of 10.18%. AG Mortgage Investment Trust has a consensus target price of $18.25, indicating a potential upside of 2.76%. Given Dynex Capital’s stronger consensus rating and higher probable upside, research analysts clearly believe Dynex Capital is more favorable than AG Mortgage Investment Trust.
Earnings and Valuation
This table compares Dynex Capital and AG Mortgage Investment Trust’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Dynex Capital||$94.50 million||3.89||$33.89 million||$0.44||14.95|
|AG Mortgage Investment Trust||$128.85 million||3.89||$118.55 million||$3.76||4.72|
AG Mortgage Investment Trust has higher revenue and earnings than Dynex Capital. AG Mortgage Investment Trust is trading at a lower price-to-earnings ratio than Dynex Capital, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
53.3% of Dynex Capital shares are held by institutional investors. Comparatively, 65.1% of AG Mortgage Investment Trust shares are held by institutional investors. 7.1% of Dynex Capital shares are held by insiders. Comparatively, 1.6% of AG Mortgage Investment Trust shares are held 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.
Dynex Capital pays an annual dividend of $0.72 per share and has a dividend yield of 10.9%. AG Mortgage Investment Trust pays an annual dividend of $1.90 per share and has a dividend yield of 10.7%. Dynex Capital pays out 163.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. AG Mortgage Investment Trust pays out 50.5% of its earnings in the form of a dividend.
Risk & Volatility
Dynex Capital has a beta of 0.71, meaning that its stock price is 29% less volatile than the S&P 500. Comparatively, AG Mortgage Investment Trust has a beta of 0.77, meaning that its stock price is 23% less volatile than the S&P 500.
This table compares Dynex Capital and AG Mortgage Investment Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|AG Mortgage Investment Trust||92.01%||11.23%||1.81%|
AG Mortgage Investment Trust beats Dynex Capital on 9 of the 16 factors compared between the two stocks.
About Dynex Capital
Dynex Capital, Inc. is an internally managed mortgage real estate investment trust, which invests in residential and commercial mortgage securities on a leveraged basis. The Company’s objective is to provide attractive risk-adjusted returns to its shareholders over the long term that is reflective of a leveraged fixed income portfolio with a focus on capital preservation. It seeks to provide returns to its shareholders through regular quarterly dividends and through capital appreciation. It invests in Agency and non-Agency mortgage-backed securities (MBS). MBS consists of residential MBS (RMBS), commercial MBS (CMBS) and CMBS interest-only securities. Agency MBS have a guaranty of principal payment by an agency of the United States Government or a government-sponsored entity (GSE), such as Fannie Mae and Freddie Mac.
About AG Mortgage Investment Trust
AG Mortgage Investment Trust, Inc. is a real estate investment trust (REIT). The Company focuses on investing in, acquiring and managing a diversified portfolio of residential mortgage assets, other real estate-related securities and financial assets, which the Company refers to as its target assets. It also focuses on investing in residential mortgage-backed securities (RMBS) issued or guaranteed by a government-sponsored enterprise, such as The Federal National Mortgage Association (Fannie Mae) or The Federal Home Loan Mortgage Corporation (Freddie Mac) (collectively, GSEs), or any agency of the United States Government, such as The Government National Mortgage Association (Ginnie Mae) (collectively Agency RMBS), and other real estate-related securities and financial assets, including Non-Agency RMBS, asset backed securities (ABS), commercial mortgage-backed securities (CMBS) and loans.
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