Chicago Atlantic Real Estate Finance (NASDAQ:REFI – Get Free Report) and Claros Mortgage Trust (NYSE:CMTG – 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 analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.
Profitability
This table compares Chicago Atlantic Real Estate Finance and Claros Mortgage Trust’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Chicago Atlantic Real Estate Finance | 54.57% | 11.53% | 8.06% |
| Claros Mortgage Trust | -354.13% | -19.70% | -6.52% |
Valuation & Earnings
This table compares Chicago Atlantic Real Estate Finance and Claros Mortgage Trust”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Chicago Atlantic Real Estate Finance | $53.45 million | 4.70 | $36.01 million | $1.37 | 7.15 |
| Claros Mortgage Trust | $187.83 million | 0.91 | -$489.07 million | ($3.83) | -0.31 |
Chicago Atlantic Real Estate Finance has higher earnings, but lower revenue than Claros Mortgage Trust. Claros Mortgage Trust is trading at a lower price-to-earnings ratio than Chicago Atlantic Real Estate Finance, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of recent ratings and recommmendations for Chicago Atlantic Real Estate Finance and Claros Mortgage Trust, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Chicago Atlantic Real Estate Finance | 0 | 3 | 2 | 0 | 2.40 |
| Claros Mortgage Trust | 3 | 1 | 0 | 0 | 1.25 |
Chicago Atlantic Real Estate Finance currently has a consensus target price of $15.33, suggesting a potential upside of 56.46%. Claros Mortgage Trust has a consensus target price of $2.22, suggesting a potential upside of 83.96%. Given Claros Mortgage Trust’s higher possible upside, analysts plainly believe Claros Mortgage Trust is more favorable than Chicago Atlantic Real Estate Finance.
Insider and Institutional Ownership
25.5% of Chicago Atlantic Real Estate Finance shares are held by institutional investors. Comparatively, 89.5% of Claros Mortgage Trust shares are held by institutional investors. 6.5% of Chicago Atlantic Real Estate Finance shares are held by company insiders. Comparatively, 2.6% of Claros Mortgage Trust shares are held by company 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.
Risk and Volatility
Chicago Atlantic Real Estate Finance has a beta of 0.26, suggesting that its share price is 74% less volatile than the S&P 500. Comparatively, Claros Mortgage Trust has a beta of 1.16, suggesting that its share price is 16% more volatile than the S&P 500.
Summary
Chicago Atlantic Real Estate Finance beats Claros Mortgage Trust on 10 of the 14 factors compared between the two stocks.
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.
About Claros Mortgage Trust
Claros Mortgage Trust, Inc. operates as a real estate investment trust. It focuses on originating senior and subordinate loans on transitional commercial real estate assets in the United States. The company has elected to be taxed as a real estate investment trust. As a result, it would not be subject to corporate income tax on that portion of its net income that is distributed to shareholders. The company was incorporated in 2015 and is headquartered in New York, New York.
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