Financial Survey: Claros Mortgage Trust (NYSE:CMTG) & HG (OTCMKTS:STLY)

HG (OTCMKTS:STLY) and Claros Mortgage Trust (NYSE:CMTG) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, analyst recommendations, risk, institutional ownership, profitability and earnings.

Analyst Recommendations

This is a breakdown of recent ratings for HG and Claros Mortgage Trust, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
HG	0	0	0	0	0.00
Claros Mortgage Trust	3	0	1	0	1.50

Claros Mortgage Trust has a consensus target price of $3.33, indicating a potential downside of 3.77%. Given Claros Mortgage Trust’s stronger consensus rating and higher possible upside, analysts clearly believe Claros Mortgage Trust is more favorable than HG.

Earnings and Valuation

This table compares HG and Claros Mortgage Trust”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
HG	$11.51 million	2.06	-$240,000.00	$0.43	10.58
Claros Mortgage Trust	$248.41 million	1.96	-$221.26 million	($2.65)	-1.31

HG has higher earnings, but lower revenue than Claros Mortgage Trust. Claros Mortgage Trust is trading at a lower price-to-earnings ratio than HG, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

1.7% of HG shares are held by institutional investors. Comparatively, 89.5% of Claros Mortgage Trust shares are held by institutional investors. 75.0% of HG shares are held by insiders. Comparatively, 1.8% of Claros Mortgage Trust shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

HG has a beta of 0.44, meaning that its stock price is 56% less volatile than the S&P 500. Comparatively, Claros Mortgage Trust has a beta of 1.19, meaning that its stock price is 19% more volatile than the S&P 500.

Profitability

This table compares HG and Claros Mortgage Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
HG	12.44%	4.58%	3.41%
Claros Mortgage Trust	-184.07%	-7.99%	-2.39%

Summary

HG beats Claros Mortgage Trust on 8 of the 14 factors compared between the two stocks.

About HG

HG Holdings, Inc. engages in the title insurance and real estate businesses in the United States. It operates through four segments: Title Insurance Services, Reinsurance, Management Services, and Real Estate. The company provides title insurance, closing and/or escrow, and similar or related services in connection with residential and commercial real estate transactions. It also owns and operates a portfolio of single-tenant properties leased for the occupancy by U.S. government tenant agencies and sub-agencies, such as the Federal Bureau of Investigation, the Department of Veterans affairs, the Drug Enforcement Administration, Immigration & Customs Enforcement, the Social Security Administration, and the Department of Transportation. In addition, the company provides excess-of-loss reinsurance coverage related to catastrophic weather risk in Texas; and management advisory services, such as formation, operational, and restructuring services. The company was formerly known as Stanley Furniture Company, Inc. and changed its name to HG Holdings, Inc. in March 2018. HG Holdings, Inc. was incorporated in 1984 and is headquartered in Charlotte, North Carolina.

About Claros Mortgage Trust

Claros Mortgage Trust, Inc. operates as a real estate investment trust. It focuses on originating senior and subordinate loans on transitional commercial real estate assets in the United States. The company has elected to be taxed as a real estate investment trust. As a result, it would not be subject to corporate income tax on that portion of its net income that is distributed to shareholders. The company was incorporated in 2015 and is headquartered in New York, New York.