Critical Survey: W. P. Carey (NYSE:WPC) vs. Cherry Hill Mortgage Investment (NYSE:CHMI)

Cherry Hill Mortgage Investment (NYSE:CHMI) and W. P. Carey (NYSE:WPC) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, dividends, institutional ownership, earnings, valuation, profitability and analyst recommendations.

Risk & Volatility

Cherry Hill Mortgage Investment has a beta of 1.39, meaning that its share price is 39% more volatile than the S&P 500. Comparatively, W. P. Carey has a beta of 0.96, meaning that its share price is 4% less volatile than the S&P 500.

Institutional & Insider Ownership

18.5% of Cherry Hill Mortgage Investment shares are held by institutional investors. Comparatively, 73.7% of W. P. Carey shares are held by institutional investors. 1.4% of Cherry Hill Mortgage Investment shares are held by company insiders. Comparatively, 1.1% of W. P. Carey shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Dividends

Cherry Hill Mortgage Investment pays an annual dividend of $0.60 per share and has a dividend yield of 21.4%. W. P. Carey pays an annual dividend of $3.52 per share and has a dividend yield of 6.5%. Cherry Hill Mortgage Investment pays out -39.5% of its earnings in the form of a dividend. W. P. Carey pays out 138.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Cherry Hill Mortgage Investment is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Cherry Hill Mortgage Investment and W. P. Carey’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cherry Hill Mortgage Investment	-60.97%	15.18%	1.45%
W. P. Carey	35.12%	6.45%	3.14%

Analyst Recommendations

This is a summary of recent recommendations and price targets for Cherry Hill Mortgage Investment and W. P. Carey, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cherry Hill Mortgage Investment	0	1	1	0	2.50
W. P. Carey	1	6	2	0	2.11

Cherry Hill Mortgage Investment currently has a consensus target price of $5.00, indicating a potential upside of 77.94%. W. P. Carey has a consensus target price of $63.25, indicating a potential upside of 16.03%. Given Cherry Hill Mortgage Investment’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Cherry Hill Mortgage Investment is more favorable than W. P. Carey.

Earnings and Valuation

This table compares Cherry Hill Mortgage Investment and W. P. Carey”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cherry Hill Mortgage Investment	-$15.04 million	-5.91	-$34.79 million	($1.52)	-1.85
W. P. Carey	$1.59 billion	7.51	$708.33 million	$2.54	21.46

W. P. Carey has higher revenue and earnings than Cherry Hill Mortgage Investment. Cherry Hill Mortgage Investment is trading at a lower price-to-earnings ratio than W. P. Carey, indicating that it is currently the more affordable of the two stocks.

Summary

W. P. Carey beats Cherry Hill Mortgage Investment on 9 of the 16 factors compared between the two stocks.

About Cherry Hill Mortgage Investment

Cherry Hill Mortgage Investment Corporation, a residential real estate finance company, acquires, invests in, and manages residential mortgage assets in the United States. It operates through Investments in RMBS (residential mortgage-backed securities) and Investments in Servicing Related Assets segments. Cherry Hill Mortgage Investment Corporation qualifies as a real estate investment trust for federal income tax purposes. The company generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. Cherry Hill Mortgage Investment Corporation was incorporated in 2012 and is based in Farmingdale, New Jersey.

About W. P. Carey

W. P. Carey ranks among the largest net lease REITs with a well-diversified portfolio of high-quality, operationally critical commercial real estate, which includes 1,424 net lease properties covering approximately 173 million square feet and a portfolio of 89 self-storage operating properties as of December 31, 2023. With offices in New York, London, Amsterdam and Dallas, the company remains focused on investing primarily in single-tenant, industrial, warehouse and retail properties located in the U.S. and Northern and Western Europe, under long-term net leases with built-in rent escalations.