Critical Contrast: Invesco Mortgage Capital (IVR) and Its Competitors

Invesco Mortgage Capital (NYSE:IVR) is one of 52 public companies in the “Mortgage Real Estate Investment Trusts (REITs)” industry, but how does it contrast to its competitors? We will compare Invesco Mortgage Capital to similar businesses based on the strength of its profitability, institutional ownership, analyst recommendations, dividends, earnings, valuation and risk.

Earnings & Valuation

This table compares Invesco Mortgage Capital and its competitors gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Invesco Mortgage Capital	$295.29 million	$101.28 million	-30.25
Invesco Mortgage Capital Competitors	$762.88 million	$157.00 million	19.65

Invesco Mortgage Capital’s competitors have higher revenue and earnings than Invesco Mortgage Capital. Invesco Mortgage Capital 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.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Invesco Mortgage Capital	-8.49%	26.75%	2.80%
Invesco Mortgage Capital Competitors	-9.73%	7.41%	1.01%

Dividends

Invesco Mortgage Capital pays an annual dividend of $1.44 per share and has a dividend yield of 26.4%. Invesco Mortgage Capital pays out -800.0% of its earnings in the form of a dividend. As a group, “Mortgage Real Estate Investment Trusts (REITs)” companies pay a dividend yield of 16.4% and pay out -110.6% of their earnings in the form of a dividend. Invesco Mortgage Capital is clearly a better dividend stock than its competitors, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of recent ratings for Invesco Mortgage Capital and its competitors, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Invesco Mortgage Capital	0	3	1	0	2.25
Invesco Mortgage Capital Competitors	686	1986	2136	136	2.35

Invesco Mortgage Capital currently has a consensus price target of $8.38, indicating a potential upside of 53.81%. As a group, “Mortgage Real Estate Investment Trusts (REITs)” companies have a potential upside of 44.38%. Given Invesco Mortgage Capital’s higher possible upside, equities research analysts plainly believe Invesco Mortgage Capital is more favorable than its competitors.

Risk & Volatility

Invesco Mortgage Capital has a beta of 1.73, meaning that its stock price is 73% more volatile than the S&P 500. Comparatively, Invesco Mortgage Capital’s competitors have a beta of 1.21, meaning that their average stock price is 21% more volatile than the S&P 500.

Insider & Institutional Ownership

40.5% of Invesco Mortgage Capital shares are held by institutional investors. Comparatively, 52.3% of shares of all “Mortgage Real Estate Investment Trusts (REITs)” companies are held by institutional investors. 0.2% of Invesco Mortgage Capital shares are held by company insiders. Comparatively, 4.8% of shares of all “Mortgage Real Estate Investment Trusts (REITs)” companies are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Invesco Mortgage Capital competitors beat Invesco Mortgage Capital on 8 of the 15 factors compared.

Invesco Mortgage Capital Company Profile

Invesco Mortgage Capital Inc. operates as a real estate investment trust (REIT) that invests, finances, and manages mortgage-backed securities and other mortgage-related assets in the United States. It invests in residential mortgage-backed securities (RMBS) and commercial mortgage-backed securities (CMBS) that are guaranteed by a U.S. government agency or federally chartered corporation; RMBS and CMBS that are not issued or guaranteed by the United States government agency or federally chartered corporation; the United States treasury securities; real estate-related financing arrangements; to-be-announced securities forward contracts to purchase RMBS; and commercial mortgage loans. It has elected to be taxed as a REIT and would be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was incorporated in 2008 and is headquartered in Atlanta, Georgia.