ARMOUR Residential REIT (NYSE:ARR) and CIM Commercial Trust (NASDAQ:CMCT) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, earnings, analyst recommendations, valuation and dividends.
This is a summary of current ratings for ARMOUR Residential REIT and CIM Commercial Trust, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|ARMOUR Residential REIT||1||1||0||0||1.50|
|CIM Commercial Trust||0||0||0||0||N/A|
Earnings & Valuation
This table compares ARMOUR Residential REIT and CIM Commercial Trust’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|ARMOUR Residential REIT||$283.15 million||3.94||-$105.96 million||$2.50||7.46|
|CIM Commercial Trust||$197.72 million||4.57||$1.12 million||N/A||N/A|
CIM Commercial Trust has lower revenue, but higher earnings than ARMOUR Residential REIT.
This table compares ARMOUR Residential REIT and CIM Commercial Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|ARMOUR Residential REIT||-85.58%||10.14%||1.30%|
|CIM Commercial Trust||148.68%||1.36%||0.45%|
Insider and Institutional Ownership
62.1% of ARMOUR Residential REIT shares are held by institutional investors. Comparatively, 1.2% of CIM Commercial Trust shares are held by institutional investors. 1.3% of ARMOUR Residential REIT shares are held by insiders. Comparatively, 90.9% of CIM Commercial Trust shares are held by 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.
ARMOUR Residential REIT pays an annual dividend of $2.28 per share and has a dividend yield of 12.2%. CIM Commercial Trust pays an annual dividend of $0.50 per share and has a dividend yield of 2.4%. ARMOUR Residential REIT pays out 91.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Risk & Volatility
ARMOUR Residential REIT has a beta of 0.63, meaning that its share price is 37% less volatile than the S&P 500. Comparatively, CIM Commercial Trust has a beta of 0.11, meaning that its share price is 89% less volatile than the S&P 500.
ARMOUR Residential REIT beats CIM Commercial Trust on 7 of the 12 factors compared between the two stocks.
About ARMOUR Residential REIT
ARMOUR Residential REIT, Inc. invests in residential mortgage backed securities in the United States. The company is managed by ARMOUR Capital Management LP. Its securities portfolio primarily consists of the United States Government-sponsored entity's (GSE) and the Government National Mortgage Administration's issued or guaranteed securities backed by fixed rate, hybrid adjustable rate, and adjustable rate home loans, as well as unsecured notes and bonds issued by the GSE and the United States treasuries; and money market instruments. The company also invests in other securities backed by residential mortgages for which the payment of principal and interest is not guaranteed by a GSE or government agency. ARMOUR Residential REIT, Inc. has elected to be taxed as a real estate investment trust under the Internal Revenue Code. As a result, it would not be subject to corporate income tax on that portion of its net income that is distributed to shareholders. The company was founded in 2008 and is based in Vero Beach, Florida.
About CIM Commercial Trust
CIM Commercial is a real estate investment trust that primarily acquires, owns, and operates Class A and creative office assets in vibrant and improving metropolitan communities throughout the United States. Its properties are primarily located in Los Angeles, the San Francisco Bay Area and Washington, D.C. CIM Commercial is operated by affiliates of CIM Group, L.P., a vertically-integrated owner and operator of real assets with multi-disciplinary expertise and in-house research, acquisition, credit analysis, development, finance, leasing, and onsite property management capabilities.
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