America First Multifamily Investors, L.P. (NASDAQ: ATAX) and Ocwen Financial Corporation (NYSE:OCN) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitabiliy, earnings, valuation, institutional ownership, analyst recommendations, dividends and risk.

Earnings and Valuation

This table compares America First Multifamily Investors, L.P. and Ocwen Financial Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
America First Multifamily Investors, L.P. N/A N/A N/A $0.41 14.51
Ocwen Financial Corporation $1.38 billion 0.25 $328.49 million ($0.97) -2.89

Ocwen Financial Corporation has higher revenue and earnings than America First Multifamily Investors, L.P.. Ocwen Financial Corporation is trading at a lower price-to-earnings ratio than America First Multifamily Investors, L.P., indicating that it is currently the more affordable of the two stocks.

Dividends

America First Multifamily Investors, L.P. pays an annual dividend of $0.50 per share and has a dividend yield of 8.4%. Ocwen Financial Corporation does not pay a dividend. America First Multifamily Investors, L.P. pays out 122.0% 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 America First Multifamily Investors, L.P. and Ocwen Financial Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
America First Multifamily Investors, L.P. 47.50% 8.61% 2.98%
Ocwen Financial Corporation -8.79% -5.55% -0.47%

Volatility & Risk

America First Multifamily Investors, L.P. has a beta of 0.42, meaning that its share price is 58% less volatile than the S&P 500. Comparatively, Ocwen Financial Corporation has a beta of 1.32, meaning that its share price is 32% more volatile than the S&P 500.

Institutional and Insider Ownership

7.3% of America First Multifamily Investors, L.P. shares are held by institutional investors. Comparatively, 47.3% of Ocwen Financial Corporation shares are held by institutional investors. 1.3% of America First Multifamily Investors, L.P. shares are held by insiders. Comparatively, 5.2% of Ocwen Financial Corporation shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings for America First Multifamily Investors, L.P. and Ocwen Financial Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
America First Multifamily Investors, L.P. 0 0 1 0 3.00
Ocwen Financial Corporation 0 5 0 0 2.00

America First Multifamily Investors, L.P. presently has a consensus price target of $6.00, suggesting a potential upside of 0.84%. Ocwen Financial Corporation has a consensus price target of $4.00, suggesting a potential upside of 42.86%. Given Ocwen Financial Corporation’s higher probable upside, analysts plainly believe Ocwen Financial Corporation is more favorable than America First Multifamily Investors, L.P..

Summary

America First Multifamily Investors, L.P. beats Ocwen Financial Corporation on 7 of the 13 factors compared between the two stocks.

About America First Multifamily Investors, L.P.

America First Multifamily Investors, L.P. is engaged in acquiring, holding, selling and dealing with a portfolio of mortgage revenue bonds, which have been issued to provide construction and/or permanent financing for multifamily and student housing (collectively Residential Properties) and commercial properties. Its segments are Mortgage Revenue Bond Investments, MF Properties, Public Housing Capital Fund Trusts and mortgage-backed securities (MBS) Investments. Its Mortgage Revenue Bond Investments segment consists of its portfolio of mortgage revenue bonds, which have been issued to provide construction and/or permanent financing for the residential properties and a commercial property. The MF Properties segment consists of indirect equity interests in multifamily, student housing, and senior citizen residential properties, which are not financed by mortgage revenue bonds held by the Company, but which it intends to finance by such bonds through a restructuring.

About Ocwen Financial Corporation

Ocwen Financial Corporation is a financial services holding company. The Company, through its subsidiaries, originates and services loans. The Company’s segments include Servicing, Lending, and Corporate Items and Other. The Company’s Servicing segment consists of its residential servicing business. The Company’s Lending segment is focused on originating and purchasing conventional and government-insured residential forward and reverse mortgage loans. The Company’s Corporate Items and Other segment includes revenues and expenses of Automotive Capital Services (ACS) and its other business activities. Its servicing clients include some of the financial institutions in the United States, including the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac), the Government National Mortgage Association (Ginnie Mae) and non-Agency residential mortgage-backed securities (RMBS) trusts.

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