Redwood Trust (NYSE:RWT) and CV (OTCMKTS:CVHL) Head-To-Head Review

Redwood Trust (NYSE:RWT) and CV (OTCMKTS:CVHL) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their earnings, risk, analyst recommendations, profitability, institutional ownership, dividends and valuation.

Profitability

This table compares Redwood Trust and CV’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Redwood Trust	-5.93%	12.00%	0.54%
CV	N/A	N/A	N/A

Analyst Ratings

This is a breakdown of recent ratings and price targets for Redwood Trust and CV, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Redwood Trust	1	4	5	0	2.40
CV	0	0	0	0	0.00

Redwood Trust presently has a consensus target price of $6.82, indicating a potential upside of 14.94%. Given Redwood Trust’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Redwood Trust is more favorable than CV.

Institutional and Insider Ownership

74.3% of Redwood Trust shares are held by institutional investors. 3.3% of Redwood Trust shares are held by company insiders. Comparatively, 7.6% of CV shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

Redwood Trust has a beta of 1.52, meaning that its share price is 52% more volatile than the S&P 500. Comparatively, CV has a beta of 1.56, meaning that its share price is 56% more volatile than the S&P 500.

Earnings and Valuation

This table compares Redwood Trust and CV”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Redwood Trust	$1.18 billion	0.63	-$70.03 million	($0.61)	-9.73
CV	$25.67 million	N/A	-$18.15 million	N/A	N/A

CV has lower revenue, but higher earnings than Redwood Trust.

Summary

Redwood Trust beats CV on 7 of the 11 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 CV

CV Holdings, Inc. operates as a specialty finance company. It owns finance platforms across various businesses, including small-ticket equipment financing and commercial real estate bridge lending. CV Holdings, Inc. was incorporated in 2005 and is based in Newport Beach, California.