Financial Contrast: CIM Commercial Trust (CMCT) vs. istar (NYSE:STAR)

CIM Commercial Trust (NASDAQ: CMCT) and istar (NYSE:STAR) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, risk, dividends, valuation and earnings.

Volatility and Risk

CIM Commercial Trust has a beta of 0.15, indicating that its stock price is 85% less volatile than the S&P 500. Comparatively, istar has a beta of 1.26, indicating that its stock price is 26% more volatile than the S&P 500.

Profitability

This table compares CIM Commercial Trust and istar’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CIM Commercial Trust 143.13% 40.88% 19.12%
istar 24.13% 19.57% 3.97%

Dividends

CIM Commercial Trust pays an annual dividend of $0.50 per share and has a dividend yield of 2.7%. istar does not pay a dividend.

Analyst Ratings

This is a summary of recent ratings and recommmendations for CIM Commercial Trust and istar, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CIM Commercial Trust 0 0 0 0 N/A
istar 0 2 0 0 2.00

istar has a consensus target price of $14.00, indicating a potential upside of 24.33%. Given istar’s higher probable upside, analysts plainly believe istar is more favorable than CIM Commercial Trust.

Institutional and Insider Ownership

1.1% of CIM Commercial Trust shares are owned by institutional investors. Comparatively, 87.5% of istar shares are owned by institutional investors. 98.1% of CIM Commercial Trust shares are owned by insiders. Comparatively, 4.4% of istar shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation and Earnings

This table compares CIM Commercial Trust and istar’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CIM Commercial Trust $265.93 million 4.02 $34.54 million N/A N/A
istar $477.03 million 1.61 $95.30 million ($0.53) -21.25

istar has higher revenue and earnings than CIM Commercial Trust.

Summary

CIM Commercial Trust beats istar on 7 of the 12 factors compared between the two stocks.

CIM Commercial Trust Company Profile

CIM Commercial Trust Corporation, together with its subsidiaries, primarily invests in, owns, and operates Class A and office investments in urban communities throughout the United States. These communities are located in areas that include traditional downtown areas and suburban main streets. The Company’s segments are office, hotel, multifamily and lending. The products for its office segment primarily include rental of office space and other tenant services, including tenant reimbursements, parking, and storage space rental. The products for its multifamily segment include rental of apartments and other tenant services. The products for its hotel segment include revenues generated from the operations of hotel properties and rental income generated from a garage located directly across the street from one of the hotels. The Company is managed by affiliates of CIM Group, L.P. (CIM), a vertically integrated, full-service investment manager.

istar Company Profile

iStar Inc. finances, invests in and develops real estate and real estate related projects as part of its integrated investment platform. The Company’s four business segments are Real Estate Finance, Net Lease, Operating Properties, and Land and Development. The Real Estate Finance portfolio consists of senior and mezzanine real estate loans that may be either fixed-rate or variable-rate. The Net Lease portfolio consists of properties owned by the Company and leased to single tenants, where the properties are subject to long-term leases. The Operating Properties portfolio consists of commercial and residential properties, which represent a pool of assets across a range of geographies and property types. The Land and Development portfolio consists of land entitled for master planned communities, as well as waterfront and urban infill land parcels located throughout the United States. Its Land and Development projects include Great Oaks, Sage Scottsdale, Naples Reserve and Coney Island.

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