Financial Survey: NexPoint Real Estate Finance (NYSE:NREF) vs. AG Mortgage Investment Trust (NYSE:MITT)

AG Mortgage Investment Trust (NYSE:MITT) and NexPoint Real Estate Finance (NYSE:NREF) are both small-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, earnings, risk, dividends, institutional ownership, analyst recommendations and profitability.

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%

Dividends

AG Mortgage Investment Trust pays an annual dividend of $0.92 per share and has a dividend yield of 10.0%. NexPoint Real Estate Finance pays an annual dividend of $2.00 per share and has a dividend yield of 13.3%. 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 raised its dividend for 2 consecutive years. NexPoint Real Estate Finance is clearly the better dividend stock, given its higher yield and lower payout ratio.

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. 3.2% of AG Mortgage Investment Trust shares are held by company insiders. Comparatively, 55.7% of NexPoint Real Estate Finance shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Volatility and Risk

AG Mortgage Investment Trust has a beta of 1.65, meaning that its stock price is 65% more volatile than the S&P 500. Comparatively, NexPoint Real Estate Finance has a beta of 1.19, meaning that its stock price is 19% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for AG Mortgage Investment Trust and NexPoint Real Estate Finance, as provided 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 presently has a consensus target price of $9.00, indicating a potential downside of 1.98%. NexPoint Real Estate Finance has a consensus target price of $14.50, indicating a potential downside of 3.34%. Given AG Mortgage Investment Trust’s stronger consensus rating and higher probable upside, equities research analysts clearly believe AG Mortgage Investment Trust is more favorable than NexPoint Real Estate Finance.

Earnings & Valuation

This table compares AG Mortgage Investment Trust and NexPoint Real Estate Finance”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AG Mortgage Investment Trust	$408.49 million	0.71	$55.74 million	$0.93	9.87
NexPoint Real Estate Finance	$72.51 million	3.67	$29.19 million	$2.81	5.34

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.

Summary

NexPoint Real Estate Finance beats AG Mortgage Investment Trust on 9 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.