Apollo Commercial Real Estate Finance (NYSE:ARI – Get Free Report) and Chicago Atlantic Real Estate Finance (NASDAQ:REFI – Get Free Report) are both small-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, risk, earnings, dividends, analyst recommendations, institutional ownership and valuation.
Valuation and Earnings
This table compares Apollo Commercial Real Estate Finance and Chicago Atlantic Real Estate Finance”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Apollo Commercial Real Estate Finance | $271.59 million | 3.06 | $126.72 million | $0.80 | 8.07 |
| Chicago Atlantic Real Estate Finance | $55.39 million | 5.00 | $36.01 million | $1.37 | 7.88 |
Risk & Volatility
Apollo Commercial Real Estate Finance has a beta of 1.36, indicating that its stock price is 36% more volatile than the S&P 500. Comparatively, Chicago Atlantic Real Estate Finance has a beta of 0.26, indicating that its stock price is 74% less volatile than the S&P 500.
Dividends
Apollo Commercial Real Estate Finance pays an annual dividend of $1.00 per share and has a dividend yield of 15.5%. Chicago Atlantic Real Estate Finance pays an annual dividend of $1.88 per share and has a dividend yield of 17.4%. Apollo Commercial Real Estate Finance pays out 125.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Chicago Atlantic Real Estate Finance pays out 137.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Chicago Atlantic Real Estate Finance has increased its dividend for 1 consecutive years. Chicago Atlantic Real Estate Finance is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Insider and Institutional Ownership
54.4% of Apollo Commercial Real Estate Finance shares are owned by institutional investors. Comparatively, 25.5% of Chicago Atlantic Real Estate Finance shares are owned by institutional investors. 0.5% of Apollo Commercial Real Estate Finance shares are owned by insiders. Comparatively, 6.5% of Chicago Atlantic Real Estate Finance shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Analyst Ratings
This is a breakdown of recent ratings and target prices for Apollo Commercial Real Estate Finance and Chicago Atlantic Real Estate Finance, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Apollo Commercial Real Estate Finance | 0 | 4 | 2 | 0 | 2.33 |
| Chicago Atlantic Real Estate Finance | 0 | 3 | 2 | 0 | 2.40 |
Apollo Commercial Real Estate Finance presently has a consensus price target of $11.33, suggesting a potential upside of 75.44%. Chicago Atlantic Real Estate Finance has a consensus price target of $15.33, suggesting a potential upside of 41.98%. Given Apollo Commercial Real Estate Finance’s higher possible upside, research analysts plainly believe Apollo Commercial Real Estate Finance is more favorable than Chicago Atlantic Real Estate Finance.
Profitability
This table compares Apollo Commercial Real Estate Finance and Chicago Atlantic Real Estate Finance’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Apollo Commercial Real Estate Finance | 55.49% | 7.39% | 1.58% |
| Chicago Atlantic Real Estate Finance | 54.57% | 11.53% | 8.06% |
About Apollo Commercial Real Estate Finance
Apollo Commercial Real Estate Finance, Inc. operates as a real estate investment trust (REIT) that originates, acquires, invests in, and manages commercial first mortgage loans, subordinate financings, and other commercial real estate-related debt investments in the United States, the United Kingdom, and Europe. It is qualified as a REIT under the Internal Revenue Code. As a REIT, it would not be subject to federal income taxes, if the company distributes at least 90% of its REIT taxable income to its stockholders. Apollo Commercial Real Estate Finance, Inc. was incorporated in 2009 and is based in New York, New York.
About Chicago Atlantic Real Estate Finance
Chicago Atlantic Real Estate Finance, Inc. operates as a commercial real estate finance company in the United States. The company engages in originating, structuring, and investing in first mortgage loans and alternative structured financings secured by commercial real estate properties. Its portfolio primarily includes offers senior loans to state-licensed operators in the cannabis industry. The company has elected to be taxed as a real estate investment trust (REIT) and would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. Chicago Atlantic Real Estate Finance, Inc. was incorporated in 2021 and is headquartered in Chicago, Illinois.
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