Reviewing RAIT Financial Trust (RAS) and Annaly Commercial Real Estate Group (CXS)

RAIT Financial Trust (NYSE: RAS) and Annaly Commercial Real Estate Group (NYSE:CXS) are both financials companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, profitability, institutional ownership, earnings, dividends, risk and analyst recommendations.

Institutional and Insider Ownership

52.2% of RAIT Financial Trust shares are owned by institutional investors. 1.3% of RAIT Financial Trust shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings and target prices for RAIT Financial Trust and Annaly Commercial Real Estate Group, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
RAIT Financial Trust 1 3 0 0 1.75
Annaly Commercial Real Estate Group 0 0 0 0 N/A

RAIT Financial Trust presently has a consensus target price of $1.43, suggesting a potential upside of 203.19%.

Profitability

This table compares RAIT Financial Trust and Annaly Commercial Real Estate Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
RAIT Financial Trust -137.66% -0.66% -0.09%
Annaly Commercial Real Estate Group N/A N/A N/A

Valuation & Earnings

This table compares RAIT Financial Trust and Annaly Commercial Real Estate Group’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
RAIT Financial Trust $173.61 million 0.25 $25.34 million ($2.34) -0.20
Annaly Commercial Real Estate Group N/A N/A N/A $0.83 N/A

RAIT Financial Trust has higher revenue and earnings than Annaly Commercial Real Estate Group. RAIT Financial Trust is trading at a lower price-to-earnings ratio than Annaly Commercial Real Estate Group, indicating that it is currently the more affordable of the two stocks.

Dividends

RAIT Financial Trust pays an annual dividend of $0.14 per share and has a dividend yield of 29.8%. Annaly Commercial Real Estate Group does not pay a dividend. RAIT Financial Trust pays out -6.0% of its earnings in the form of a dividend.

Summary

RAIT Financial Trust beats Annaly Commercial Real Estate Group on 5 of the 9 factors compared between the two stocks.

RAIT Financial Trust Company Profile

RAIT Financial Trust (RAIT) is a real estate investment trust (REIT). The Company focuses on providing commercial real estate (CRE) financing throughout the United States. The core of its business is a full service CRE lending platform focused on first lien loans. It offers customized lending solutions to meet borrower needs and internal credit goals. It offers personalized middle-market financing solutions and a complement of lending products for CRE. The Company may also offer mezzanine loans and preferred equity interests in limited circumstances to support first lien loans. It is engaged in floating rate securitization programs and has access to multiple sources of funding, including senior debt, convertible securities, preferred securities and common securities. The Company also owns and manages a portfolio of CRE properties, and manages real estate assets for third parties. The Company is engaged in lending, owning and managing CRE assets throughout the United States.

Annaly Commercial Real Estate Group Company Profile

CreXus Investment Corp. is a real estate investment trust (REIT). The Company is a commercial real estate company that acquires, manages, and finances, directly or through its subsidiaries, commercial mortgage loans and other commercial real estate debt, commercial real property, commercial mortgage-backed securities (CMBS), other commercial real estate-related assets and Agency residential mortgage-backed securities. The Company also engages in long-term sale-leaseback and build-to-suit transactions with companies in the United States. The Company is managed by Fixed Income Discount Advisory Company (FIDAC). FIDAC is a wholly owned subsidiary of Annaly Capital Management, Inc. (Annaly).

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