Apollo Residential Mortgage (NYSE: AMTG) is one of 38 public companies in the “Mortgage REITs” industry, but how does it weigh in compared to its competitors? We will compare Apollo Residential Mortgage to similar businesses based on the strength of its risk, dividends, profitability, analyst recommendations, earnings, valuation and institutional ownership.

Risk and Volatility

Apollo Residential Mortgage has a beta of 0.61, meaning that its stock price is 39% less volatile than the S&P 500. Comparatively, Apollo Residential Mortgage’s competitors have a beta of 0.71, meaning that their average stock price is 29% less volatile than the S&P 500.

Profitability

This table compares Apollo Residential Mortgage and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Apollo Residential Mortgage 56.35% 10.11% 2.60%
Apollo Residential Mortgage Competitors 49.20% 10.70% 2.78%

Analyst Recommendations

This is a breakdown of current ratings and target prices for Apollo Residential Mortgage and its competitors, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Apollo Residential Mortgage 0 0 0 0 N/A
Apollo Residential Mortgage Competitors 110 828 838 31 2.44

As a group, “Mortgage REITs” companies have a potential upside of 2.16%. Given Apollo Residential Mortgage’s competitors higher possible upside, analysts plainly believe Apollo Residential Mortgage has less favorable growth aspects than its competitors.

Earnings and Valuation

This table compares Apollo Residential Mortgage and its competitors gross revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Apollo Residential Mortgage N/A N/A -14.67
Apollo Residential Mortgage Competitors $626.30 million $243.53 million 1.58

Apollo Residential Mortgage’s competitors have higher revenue and earnings than Apollo Residential Mortgage. Apollo Residential Mortgage is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Insider & Institutional Ownership

57.9% of shares of all “Mortgage REITs” companies are held by institutional investors. 3.3% of shares of all “Mortgage REITs” companies are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Dividends

Apollo Residential Mortgage pays an annual dividend of $1.92 per share and has a dividend yield of 14.1%. Apollo Residential Mortgage pays out -206.4% of its earnings in the form of a dividend. As a group, “Mortgage REITs” companies pay a dividend yield of 10.0% and pay out 80.5% of their earnings in the form of a dividend. Apollo Residential Mortgage has increased its dividend for 2 consecutive years. Apollo Residential Mortgage is clearly a better dividend stock than its competitors, given its higher yield and lower payout ratio.

Summary

Apollo Residential Mortgage competitors beat Apollo Residential Mortgage on 7 of the 10 factors compared.

Apollo Residential Mortgage Company Profile

Apollo Residential Mortgage, Inc. is a holding company that conducts its business primarily through ARM Operating, LLC and other operating subsidiaries. The Company is primarily engaged in the business of investing in residential mortgage assets in the United States. The Company seeks to generate risk-adjusted returns from its assets to its stockholders over the long term, primarily through dividend distributions and secondarily through capital appreciation. The Company’s portfolio consists of agency residential mortgage-backed securities (RMBS), non-Agency RMBS; securitized mortgage loans, and other mortgage and mortgage related investment securities and other mortgage related investments. The Company may invest in a range of other residential mortgage and mortgage-related assets. The Company is externally managed and advised by ARM Manager, LLC, an indirect subsidiary of Apollo Global Management, LLC.

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