AG Mortgage Investment Trust (NYSE:MITT – Get Free Report) and NexPoint Real Estate Finance (NYSE:NREF – Get Free Report) are both small-cap finance companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, risk, dividends and institutional ownership.
Dividends
AG Mortgage Investment Trust pays an annual dividend of $0.92 per share and has a dividend yield of 10.4%. NexPoint Real Estate Finance pays an annual dividend of $2.00 per share and has a dividend yield of 14.1%. AG Mortgage Investment Trust pays out 98.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NexPoint Real Estate Finance pays out 71.2% of its earnings in the form of a dividend. AG Mortgage Investment Trust has increased its dividend for 2 consecutive years. NexPoint Real Estate Finance is clearly the better dividend stock, given its higher yield and lower payout ratio.
Profitability
This table compares AG Mortgage Investment Trust and NexPoint Real Estate Finance’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| AG Mortgage Investment Trust | 11.03% | 13.88% | 0.59% |
| NexPoint Real Estate Finance | 102.28% | 17.52% | 1.14% |
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| AG Mortgage Investment Trust | $408.49 million | 0.69 | $55.74 million | $0.93 | 9.52 |
| NexPoint Real Estate Finance | $72.51 million | 3.46 | $29.19 million | $2.81 | 5.03 |
AG Mortgage Investment Trust has higher revenue and earnings than NexPoint Real Estate Finance. NexPoint Real Estate Finance is trading at a lower price-to-earnings ratio than AG Mortgage Investment Trust, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent ratings and recommmendations for AG Mortgage Investment Trust and NexPoint Real Estate Finance, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| AG Mortgage Investment Trust | 0 | 3 | 4 | 0 | 2.57 |
| NexPoint Real Estate Finance | 0 | 3 | 0 | 0 | 2.00 |
AG Mortgage Investment Trust currently has a consensus target price of $9.00, indicating a potential upside of 1.60%. NexPoint Real Estate Finance has a consensus target price of $14.50, indicating a potential upside of 2.50%. Given NexPoint Real Estate Finance’s higher probable upside, analysts clearly believe NexPoint Real Estate Finance is more favorable than AG Mortgage Investment Trust.
Volatility & Risk
AG Mortgage Investment Trust has a beta of 1.65, meaning that its share price is 65% more volatile than the S&P 500. Comparatively, NexPoint Real Estate Finance has a beta of 1.19, meaning that its share price is 19% more volatile than the S&P 500.
Institutional & Insider Ownership
27.3% of AG Mortgage Investment Trust shares are held by institutional investors. Comparatively, 67.8% of NexPoint Real Estate Finance shares are held by institutional investors. 3.8% of AG Mortgage Investment Trust shares are held by company insiders. Comparatively, 54.0% of NexPoint Real Estate Finance shares are held by company 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.
Summary
NexPoint Real Estate Finance beats AG Mortgage Investment Trust on 10 of the 17 factors compared between the two stocks.
About AG Mortgage Investment Trust
AG Mortgage Investment Trust, Inc. operates as a residential mortgage real estate investment trust in the United States. Its investment portfolio includes residential investments, including non-agency loans, agency-eligible loans, re-and non-performing loans, and non-agency residential mortgage-backed securities, as well as commercial loans and commercial mortgage-backed securities. 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. AG Mortgage Investment Trust, Inc. was incorporated in 2011 and is based in New York, New York.
About NexPoint Real Estate Finance
NexPoint Real Estate Finance, Inc. operates as a commercial mortgage real estate investment trust in the United States. It focuses on originating, structuring, and investing in first-lien mortgage loans, mezzanine loans, preferred equity, convertible notes, multifamily properties, and common equity investments, as well as multifamily and single-family rental commercial mortgage-backed securities securitizations, multifamily structured credit risk notes, and mortgage-backed securities or target assets. The company has elected to be taxed as a real estate investment trust (REIT) and would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. NexPoint Real Estate Finance, Inc. was incorporated in 2019 and is based in Dallas, Texas.
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