Generation Income Properties (NASDAQ:GIPR) and Redwood Trust (NYSE:RWT) Head-To-Head Comparison

Redwood Trust (NYSE:RWT) and Generation Income Properties (NASDAQ:GIPR) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, risk, profitability, institutional ownership and earnings.

Risk and Volatility

Redwood Trust has a beta of 1.48, meaning that its share price is 48% more volatile than the S&P 500. Comparatively, Generation Income Properties has a beta of -0.05, meaning that its share price is 105% less volatile than the S&P 500.

Profitability

This table compares Redwood Trust and Generation Income Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Redwood Trust	-6.93%	8.89%	0.48%
Generation Income Properties	-103.22%	-723.20%	-8.62%

Insider & Institutional Ownership

74.3% of Redwood Trust shares are held by institutional investors. Comparatively, 20.7% of Generation Income Properties shares are held by institutional investors. 2.7% of Redwood Trust shares are held by insiders. Comparatively, 6.2% of Generation Income Properties 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.

Earnings & Valuation

This table compares Redwood Trust and Generation Income Properties”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Redwood Trust	$135.31 million	5.19	$54.00 million	($0.81)	-6.84
Generation Income Properties	$9.76 million	0.52	-$8.35 million	($1.87)	-0.50

Redwood Trust has higher revenue and earnings than Generation Income Properties. Redwood Trust is trading at a lower price-to-earnings ratio than Generation Income Properties, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent recommendations and price targets for Redwood Trust and Generation Income Properties, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Redwood Trust	1	2	4	0	2.43
Generation Income Properties	1	0	0	0	1.00

Redwood Trust currently has a consensus price target of $6.75, indicating a potential upside of 21.84%. Given Redwood Trust’s stronger consensus rating and higher possible upside, analysts clearly believe Redwood Trust is more favorable than Generation Income Properties.

Summary

Redwood Trust beats Generation Income Properties on 12 of the 14 factors compared between the two stocks.

About Redwood Trust

Redwood Trust, Inc., together with its subsidiaries, operates as a specialty finance company in the United States. The company operates through three segments: Residential Consumer Mortgage Banking, Residential Investor Mortgage Banking, and Investment Portfolio. The Residential Consumer Mortgage Banking segment operates a mortgage loan conduit that acquires residential loans from third-party originators for subsequent sale, securitization, or transfer to its investment portfolio. This segment also offers derivative financial instruments to manage risks associated with residential loans. The Residential Investor Mortgage Banking segment operates a platform that originates business purpose loans to investors in single-family and multifamily residential properties and bridge loans for subsequent securitization, sale, or transfer into its investment portfolio. The Investment Portfolio segment invests in securities retained from residential consumer and investor securitization activities, and business purpose lending bridge loans, as well as residential mortgage-backed securities issued by third parties, Freddie Mac K-Series multifamily loan securitizations and reperforming loan securitizations, servicer advance investments, home equity investments, and other housing-related investments. The company is elected to be taxed as a real estate investment trust (REIT) for federal income tax purposes. Redwood Trust, Inc. was incorporated in 1994 and is headquartered in Mill Valley, California.

About Generation Income Properties

Generation Income Properties, Inc., located in Tampa, Florida, is an internally managed real estate investment trust formed to acquire and own, directly and jointly, real estate investments focused on retail, office, and industrial net lease properties in densely populated submarkets.