Franklin BSP Realty Trust (NYSE:FBRT) and Rithm Capital (NYSE:RITM) Financial Contrast

Franklin BSP Realty Trust (NYSE:FBRT) and Rithm Capital (NYSE:RITM) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, valuation, risk, dividends, profitability and analyst recommendations.

Earnings and Valuation

This table compares Franklin BSP Realty Trust and Rithm Capital”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Franklin BSP Realty Trust	$548.44 million	1.90	$145.21 million	$0.82	15.50
Rithm Capital	$2.29 billion	2.53	$622.26 million	$0.99	11.26

Rithm Capital has higher revenue and earnings than Franklin BSP Realty Trust. Rithm Capital is trading at a lower price-to-earnings ratio than Franklin BSP Realty Trust, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Franklin BSP Realty Trust has a beta of 1.4, indicating that its share price is 40% more volatile than the S&P 500. Comparatively, Rithm Capital has a beta of 1.79, indicating that its share price is 79% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Franklin BSP Realty Trust and Rithm Capital, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Franklin BSP Realty Trust	0	0	4	1	3.20
Rithm Capital	0	1	7	0	2.88

Franklin BSP Realty Trust presently has a consensus price target of $15.50, suggesting a potential upside of 21.95%. Rithm Capital has a consensus price target of $12.94, suggesting a potential upside of 16.03%. Given Franklin BSP Realty Trust’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Franklin BSP Realty Trust is more favorable than Rithm Capital.

Institutional & Insider Ownership

59.9% of Franklin BSP Realty Trust shares are owned by institutional investors. Comparatively, 44.9% of Rithm Capital shares are owned by institutional investors. 0.7% of Franklin BSP Realty Trust shares are owned by insiders. Comparatively, 0.4% of Rithm Capital shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Dividends

Franklin BSP Realty Trust pays an annual dividend of $1.42 per share and has a dividend yield of 11.2%. Rithm Capital pays an annual dividend of $1.00 per share and has a dividend yield of 9.0%. Franklin BSP Realty Trust pays out 173.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Rithm Capital pays out 101.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares Franklin BSP Realty Trust and Rithm Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Franklin BSP Realty Trust	45.58%	8.92%	1.89%
Rithm Capital	14.99%	17.54%	2.50%

Summary

Rithm Capital beats Franklin BSP Realty Trust on 9 of the 17 factors compared between the two stocks.

About Franklin BSP Realty Trust

Benefit Street Partners operates as a self-managed real estate investment trust (REIT). BSP earns income from investing in a leveraged portfolio of residential mortgage pass-through securities consisting almost exclusively of adjustable-rate mortgage (ARM) securities issued and guaranteed by government-sponsored enterprises, either Federal National Mortgage Association (Fannie Mae) or Federal Home Loan Mortgage Corporation (Freddie Mac) (together, the government-sponsored enterprises (GSEs)), or by an agency of the federal government, Government National Mortgage Association (Ginnie Mae). BSP’s investment strategy focuses on managing a portfolio of residential mortgage investments consisting almost exclusively of ARM Agency Securities. As of December 31, 2012, the Company’s securities consisted of Agency Securities classified as available-for-sale and Residential mortgage securities classified as held-to-maturity.

About Rithm Capital

Rithm Capital Corp. operates as an asset manager focused on real estate, credit, and financial services. It operates through Origination and Servicing, Investment Portfolio, Mortgage Loans Receivable, and Asset Management segments. Its investment portfolio primarily comprises of mortgage servicing rights (MSR), and MSR financing receivables, title, appraisal and property preservation, excess MSRs, and services advance investments; real estate securities, call rights, SFR properties, and residential mortgage loans; consumer and business purpose loans; and asset management related investments. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was formerly known as New Residential Investment Corp. and changed its name to Rithm Capital Corp. in August 2022. Rithm Capital Corp. was incorporated in 2011 and is based in New York, New York.