Contrasting Chimera Investment Corporation (CIM) & Ladder Capital Corp (LADR)

Ladder Capital Corp (NASDAQ: LADR) and Chimera Investment Corporation (NYSE:CIM) are both financials companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, dividends, analyst recommendations, earnings and profitability.

Analyst Recommendations

This is a breakdown of recent ratings for Ladder Capital Corp and Chimera Investment Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ladder Capital Corp 0 1 5 0 2.83
Chimera Investment Corporation 0 4 0 0 2.00

Ladder Capital Corp currently has a consensus target price of $15.67, indicating a potential upside of 16.74%. Chimera Investment Corporation has a consensus target price of $18.83, indicating a potential upside of 2.97%. Given Ladder Capital Corp’s stronger consensus rating and higher possible upside, research analysts plainly believe Ladder Capital Corp is more favorable than Chimera Investment Corporation.

Insider & Institutional Ownership

51.1% of Chimera Investment Corporation shares are held by institutional investors. 0.7% of Chimera Investment Corporation 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.

Valuation and Earnings

This table compares Ladder Capital Corp and Chimera Investment Corporation’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Ladder Capital Corp $325.34 million 3.55 N/A N/A N/A
Chimera Investment Corporation $933.35 million 3.68 $655.36 million $3.49 5.24

Chimera Investment Corporation has higher revenue and earnings than Ladder Capital Corp.

Dividends

Chimera Investment Corporation pays an annual dividend of $2.00 per share and has a dividend yield of 10.9%. Ladder Capital Corp does not pay a dividend. Chimera Investment Corporation pays out 57.3% of its earnings in the form of a dividend. Ladder Capital Corp has increased its dividend for 2 consecutive years.

Profitability

This table compares Ladder Capital Corp and Chimera Investment Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ladder Capital Corp 15.32% 3.93% 0.89%
Chimera Investment Corporation 63.94% 14.27% 2.52%

Summary

Chimera Investment Corporation beats Ladder Capital Corp on 8 of the 14 factors compared between the two stocks.

Ladder Capital Corp Company Profile

Ladder Capital Corp is a commercial real estate finance company. The Company’s segments include loans, securities, real estate and corporate/other. The loans segment includes mortgage loan receivables held for investment (balance sheet loans) and mortgage loan receivables held for sale (conduit loans). The securities segment consists of all of its activities related to commercial real estate securities, which include investments in commercial mortgage-backed securities (CMBS) and United States Agency Securities. The real estate segment includes net leased properties, office buildings, a warehouse and condominium units. The Corporate/other segment includes the Company’s investments in joint ventures, other asset management activities and operating expenses. The Company invests primarily in loans, securities and other interests in the United States commercial real estate, with a focus on senior secured assets.

Chimera Investment Corporation Company Profile

Chimera Investment Corporation is a real estate investment trust (REIT). The company is engaged in the business of investing in a portfolio of mortgage assets, including agency residential mortgage-backed security (RMBS), non-agency RMBS, agency commercial mortgage-backed securities (CMBS), residential mortgage loans and real estate related securities. The Company’s objective is to provide risk-adjusted returns to its investors over the long-term, primarily through dividends and secondarily through capital appreciation. The Company focuses to achieve this objective by investing in an investment portfolio of RMBS, agency CMBS, residential mortgage loans, commercial mortgage loans, real estate-related securities and various other asset classes. The MBS and real estate-related securities the Company purchases include investment-grade and non-investment grade classes, including the BB-rated, B-rated and non-rated classes. It also invests in investment grade and non-investment grade RMBS.

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