Head to Head Review: New York Mortgage Trust (NASDAQ:NYMT) and Elme Communities (NYSE:ELME)

Elme Communities (NYSE:ELME) and New York Mortgage Trust (NASDAQ:NYMT) are both small-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, valuation, analyst recommendations, dividends and profitability.

Risk and Volatility

Elme Communities has a beta of 0.9, meaning that its share price is 10% less volatile than the S&P 500. Comparatively, New York Mortgage Trust has a beta of 1.92, meaning that its share price is 92% more volatile than the S&P 500.

Profitability

This table compares Elme Communities and New York Mortgage Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Elme Communities	-5.51%	-1.17%	-0.70%
New York Mortgage Trust	3.11%	0.48%	0.06%

Dividends

Elme Communities pays an annual dividend of $0.72 per share and has a dividend yield of 4.9%. New York Mortgage Trust pays an annual dividend of $0.80 per share and has a dividend yield of 13.4%. Elme Communities pays out -480.0% of its earnings in the form of a dividend. New York Mortgage Trust pays out -242.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Analyst Recommendations

This is a summary of current ratings for Elme Communities and New York Mortgage Trust, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Elme Communities	0	4	0	0	2.00
New York Mortgage Trust	0	3	1	0	2.25

Elme Communities currently has a consensus target price of $17.00, suggesting a potential upside of 16.04%. New York Mortgage Trust has a consensus target price of $7.00, suggesting a potential upside of 16.86%. Given New York Mortgage Trust’s stronger consensus rating and higher probable upside, analysts clearly believe New York Mortgage Trust is more favorable than Elme Communities.

Valuation and Earnings

This table compares Elme Communities and New York Mortgage Trust”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Elme Communities	$239.52 million	5.38	-$52.98 million	($0.15)	-97.67
New York Mortgage Trust	$340.15 million	1.60	-$48.67 million	($0.33)	-18.15

New York Mortgage Trust has higher revenue and earnings than Elme Communities. Elme Communities is trading at a lower price-to-earnings ratio than New York Mortgage Trust, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

87.9% of Elme Communities shares are owned by institutional investors. Comparatively, 54.9% of New York Mortgage Trust shares are owned by institutional investors. 1.2% of Elme Communities shares are owned by company insiders. Comparatively, 1.5% of New York Mortgage Trust shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

New York Mortgage Trust beats Elme Communities on 12 of the 16 factors compared between the two stocks.

About Elme Communities

Elme Communities is committed to elevating what home can be for middle-income renters by providing a higher level of quality, service, and experience. The Company is a multifamily real estate investment trust that owns and operates approximately 9,400 apartment homes in the Washington, DC metro and the Atlanta metro regions, and owns approximately 300,000 square feet of commercial space. Focused on providing quality, affordable homes to a deep, solid, and underserved base of mid-market demand, Elme Communities is building long-term value for shareholders.

About New York Mortgage Trust

New York Mortgage Trust, Inc. acquires, invests in, finances, and manages mortgage-related single-family and multi-family residential assets in the United States. Its targeted investments include residential loans, including business purpose loans; structured multi-family property investments, such as preferred equity in, and mezzanine loans to owners of multi-family properties; non-agency residential mortgage-backed securities (RMBS); agency RMBS; commercial mortgage-backed securities (CMBS); single-family rental properties; and other mortgage, residential housing, and credit-related assets. The company also 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. New York Mortgage Trust, Inc. was incorporated in 2003 and is headquartered in New York, New York.