Reis (NASDAQ: REIS) and Nationstar Mortgage Holdings (NYSE:NSM) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, analyst recommendations, institutional ownership, risk, profitability, earnings and valuation.

Insider and Institutional Ownership

59.7% of Reis shares are held by institutional investors. Comparatively, 98.5% of Nationstar Mortgage Holdings shares are held by institutional investors. 21.6% of Reis shares are held by insiders. Comparatively, 0.8% of Nationstar Mortgage Holdings shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations for Reis and Nationstar Mortgage Holdings, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Reis 0 0 2 0 3.00
Nationstar Mortgage Holdings 2 3 5 0 2.30

Reis currently has a consensus price target of $24.50, suggesting a potential upside of 38.03%. Nationstar Mortgage Holdings has a consensus price target of $18.33, suggesting a potential upside of 5.55%. Given Reis’ stronger consensus rating and higher possible upside, equities research analysts plainly believe Reis is more favorable than Nationstar Mortgage Holdings.

Risk and Volatility

Reis has a beta of 1.09, meaning that its share price is 9% more volatile than the S&P 500. Comparatively, Nationstar Mortgage Holdings has a beta of 1.43, meaning that its share price is 43% more volatile than the S&P 500.

Valuation and Earnings

This table compares Reis and Nationstar Mortgage Holdings’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Reis $46.93 million 4.35 $6.64 million $0.10 177.52
Nationstar Mortgage Holdings $1.42 billion 1.20 $223.85 million $2.29 7.59

Nationstar Mortgage Holdings has higher revenue and earnings than Reis. Nationstar Mortgage Holdings is trading at a lower price-to-earnings ratio than Reis, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Reis and Nationstar Mortgage Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Reis 2.49% 1.20% 0.92%
Nationstar Mortgage Holdings 10.52% 9.64% 0.87%

Dividends

Reis pays an annual dividend of $0.68 per share and has a dividend yield of 3.8%. Nationstar Mortgage Holdings does not pay a dividend. Reis pays out 680.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Nationstar Mortgage Holdings beats Reis on 9 of the 16 factors compared between the two stocks.

Reis Company Profile

Reis, Inc. (Reis) is engaged in providing commercial real estate market information and analytical tools to real estate professionals, through its Reis Services subsidiary. The Company operates through Reis Services segment. It maintains a database containing detailed information on commercial properties in metropolitan markets and neighborhoods throughout the United States. The database contains information on apartment, office, retail, warehouse or distribution, flex or research and development, self-storage and seniors housing properties, and is used by real estate investors, lenders and other professionals to make informed buying, selling and financing decisions. Its product portfolio includes Reis Subscriber Edition (SE), its delivery platform aimed at larger and mid-sized enterprises; ReisReports, aimed at prosumers and smaller enterprises, and Mobiuss Portfolio CRE (Mobiuss), aimed at risk managers and credit administrators at banks and non-bank lending institutions.

Nationstar Mortgage Holdings Company Profile

Nationstar Mortgage Holdings Inc. provides servicing, origination and transaction based services principally to single-family residences throughout the United States. The Company operates through three segments: Servicing, Originations and Xome. The Company provides residential loan services in the United States. The Company also operates an integrated residential loan origination platform that is primarily focused on customer retention. Its Xome subsidiary offers an array of complementary services related to the purchase and disposition of residential real estate. It provides non-bank services and residential mortgage services in the United States conducting operations through its Nationstar Mortgage and Champion Mortgage brands. It originates and purchases conventional mortgage loans conforming to the underwriting standards of the government sponsored entities, which it collectively refers to as Agency loans. The Xome segment is a provider of technology and data-enhanced solutions.

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