Reviewing Ellington Financial (NYSE:EFC) & Fangdd Network Group (NASDAQ:DUO)

Ellington Financial (NYSE:EFCGet Rating) and Fangdd Network Group (NASDAQ:DUOGet Rating) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, profitability, valuation, dividends, earnings, institutional ownership and analyst recommendations.

Institutional & Insider Ownership

60.4% of Ellington Financial shares are held by institutional investors. 6.4% of Ellington Financial shares are held 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.

Analyst Recommendations

This is a summary of current ratings for Ellington Financial and Fangdd Network Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ellington Financial 0 2 2 0 2.50
Fangdd Network Group 1 0 0 0 1.00

Ellington Financial presently has a consensus target price of $19.00, suggesting a potential upside of 17.00%. Given Ellington Financial’s stronger consensus rating and higher possible upside, research analysts plainly believe Ellington Financial is more favorable than Fangdd Network Group.

Risk and Volatility

Ellington Financial has a beta of 1.96, meaning that its stock price is 96% more volatile than the S&P 500. Comparatively, Fangdd Network Group has a beta of -0.57, meaning that its stock price is 157% less volatile than the S&P 500.

Earnings & Valuation

This table compares Ellington Financial and Fangdd Network Group’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ellington Financial $131.48 million 7.10 $135.25 million $2.63 6.17
Fangdd Network Group $355.26 million 0.05 -$33.76 million ($1.25) -0.20

Ellington Financial has higher earnings, but lower revenue than Fangdd Network Group. Fangdd Network Group is trading at a lower price-to-earnings ratio than Ellington Financial, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Ellington Financial and Fangdd Network Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ellington Financial 102.64% 10.24% 2.14%
Fangdd Network Group -45.15% -53.38% -19.18%

Summary

Ellington Financial beats Fangdd Network Group on 13 of the 14 factors compared between the two stocks.

About Ellington Financial (Get Rating)

Ellington Financial Inc., through its subsidiary, Ellington Financial Operating Partnership LLC, acquires and manages mortgage-related, consumer-related, corporate-related, and other financial assets in the United States. The company acquires and manages residential mortgage-backed securities (RMBS) backed by prime jumbo, Alt-A, manufactured housing, and subprime residential mortgage loans; RMBS for which the principal and interest payments are guaranteed by the U.S. government agency or the U.S. government-sponsored entity; residential mortgage loans; commercial mortgage-backed securities; and commercial mortgage loans and other commercial real estate debt. It also provides collateralized loan obligations; mortgage-related and non-mortgage-related derivatives; corporate debt and equity securities; corporate loans; and other strategic investments. In addition, the company offers consumer loans and asset-backed securities backed by consumer and commercial assets. Ellington Financial LLC was incorporated in 2007 and is based in Old Greenwich, Connecticut.

About Fangdd Network Group (Get Rating)

Fangdd Network Group Ltd. operates as an online real estate marketplace in the People's Republic of China. The company operates Duoduo Sales for real estate agents to access primary and other property listings, large real estate buyer base, and marketplace products and services, such as shared listings, data analytic tools, premium marketplace functions, and AI-based marketplace assistance, as well as evaluate online business performances; and Duoduo Cloud Agency that provides a suite of tools and services to agencies manage their business and agents. It also operates Fangduoduo, which offers primary and secondary listings, vacation properties, and real estate market news and pricing information services; Property Cloud, a SaaS solution for real estate developers for listing properties, publishing commission rates, and setting other terms in connection with the sale; and www.fangdd.com that offers real estate agents and real estate buyers region-specific real estate news, information, property data, and access to shared-interest online communities. The company offers core management system, which enables agencies and agents to perform their daily operation, such as managing listings, serving real estate buyers, and cooperating with other marketplace participants; online shops that enable agents to reach, connect, and engage with a range of real estate buyers and sellers, which integrates their online and offline operations with its management system; and agent verification and ranking systems. It also provides real estate information solutions, which offers real-estate related information to agents, consisting of property and neighborhood information, transaction history, data, and other market insights; online sales and marketing solutions; and online education systems. As of December 31, 2020, its marketplace had approximately 1.6 million real estate agents. The company was founded in 2011 and is headquartered in Shenzhen, the People's Republic of China.

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