Granite Point Mortgage Trust (NYSE:GPMT – Get Free Report) and Cherry Hill Mortgage Investment (NYSE:CHMI – Get Free Report) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, profitability, valuation, risk, institutional ownership, earnings and analyst recommendations.
Risk and Volatility
Granite Point Mortgage Trust has a beta of 1.9, indicating that its stock price is 90% more volatile than the S&P 500. Comparatively, Cherry Hill Mortgage Investment has a beta of 0.98, indicating that its stock price is 2% less volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of recent ratings for Granite Point Mortgage Trust and Cherry Hill Mortgage Investment, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Granite Point Mortgage Trust | 1 | 2 | 1 | 0 | 2.00 |
| Cherry Hill Mortgage Investment | 1 | 2 | 1 | 1 | 2.40 |
Institutional and Insider Ownership
51.6% of Granite Point Mortgage Trust shares are held by institutional investors. Comparatively, 18.5% of Cherry Hill Mortgage Investment shares are held by institutional investors. 3.1% of Granite Point Mortgage Trust shares are held by company insiders. Comparatively, 1.5% of Cherry Hill Mortgage Investment shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Profitability
This table compares Granite Point Mortgage Trust and Cherry Hill Mortgage Investment’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Granite Point Mortgage Trust | -39.73% | -30.39% | -9.23% |
| Cherry Hill Mortgage Investment | 14.15% | 16.17% | 1.38% |
Valuation and Earnings
This table compares Granite Point Mortgage Trust and Cherry Hill Mortgage Investment”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Granite Point Mortgage Trust | $185.55 million | 0.70 | -$207.05 million | ($1.44) | -1.91 |
| Cherry Hill Mortgage Investment | $55.80 million | 1.55 | $11.97 million | $0.02 | 117.50 |
Cherry Hill Mortgage Investment has lower revenue, but higher earnings than Granite Point Mortgage Trust. Granite Point Mortgage Trust is trading at a lower price-to-earnings ratio than Cherry Hill Mortgage Investment, indicating that it is currently the more affordable of the two stocks.
Dividends
Granite Point Mortgage Trust pays an annual dividend of $0.20 per share and has a dividend yield of 7.3%. Cherry Hill Mortgage Investment pays an annual dividend of $0.40 per share and has a dividend yield of 17.0%. Granite Point Mortgage Trust pays out -13.9% of its earnings in the form of a dividend. Cherry Hill Mortgage Investment pays out 2,000.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Cherry Hill Mortgage Investment has raised its dividend for 1 consecutive years. Cherry Hill Mortgage Investment is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Summary
Cherry Hill Mortgage Investment beats Granite Point Mortgage Trust on 12 of the 17 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 Cherry Hill Mortgage Investment
Cherry Hill Mortgage Investment Corporation, a residential real estate finance company, acquires, invests in, and manages residential mortgage assets in the United States. It operates through Investments in RMBS (residential mortgage-backed securities) and Investments in Servicing Related Assets segments. Cherry Hill Mortgage Investment Corporation qualifies as a real estate investment trust for federal income tax purposes. The company generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. Cherry Hill Mortgage Investment Corporation was incorporated in 2012 and is based in Farmingdale, New Jersey.
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