Chicago Atlantic Real Estate Finance (NASDAQ:REFI) and Granite Point Mortgage Trust (NYSE:GPMT) Head-To-Head Analysis

Chicago Atlantic Real Estate Finance (NASDAQ:REFI) and Granite Point Mortgage Trust (NYSE:GPMT) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, valuation, analyst recommendations, earnings, risk and institutional ownership.

Insider and Institutional Ownership

25.5% of Chicago Atlantic Real Estate Finance shares are owned by institutional investors. Comparatively, 51.6% of Granite Point Mortgage Trust shares are owned by institutional investors. 12.3% of Chicago Atlantic Real Estate Finance shares are owned by company insiders. Comparatively, 2.3% of Granite Point Mortgage Trust shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Volatility and Risk

Chicago Atlantic Real Estate Finance has a beta of 0.23, meaning that its share price is 77% less volatile than the S&P 500. Comparatively, Granite Point Mortgage Trust has a beta of 1.83, meaning that its share price is 83% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Chicago Atlantic Real Estate Finance and Granite Point Mortgage Trust, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Chicago Atlantic Real Estate Finance	0	0	1	1	3.50
Granite Point Mortgage Trust	0	2	2	0	2.50

Chicago Atlantic Real Estate Finance presently has a consensus target price of $20.00, suggesting a potential upside of 23.84%. Granite Point Mortgage Trust has a consensus target price of $4.58, suggesting a potential upside of 35.40%. Given Granite Point Mortgage Trust’s higher probable upside, analysts plainly believe Granite Point Mortgage Trust is more favorable than Chicago Atlantic Real Estate Finance.

Dividends

Chicago Atlantic Real Estate Finance pays an annual dividend of $1.88 per share and has a dividend yield of 11.6%. Granite Point Mortgage Trust pays an annual dividend of $0.20 per share and has a dividend yield of 5.9%. Chicago Atlantic Real Estate Finance pays out 94.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Granite Point Mortgage Trust pays out -5.2% of its earnings in the form of a dividend.

Profitability

This table compares Chicago Atlantic Real Estate Finance and Granite Point 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	64.57%	13.17%	10.10%
Granite Point Mortgage Trust	-87.21%	0.95%	0.27%

Earnings and Valuation

This table compares Chicago Atlantic Real Estate Finance and Granite Point 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	$57.15 million	5.55	$38.71 million	$2.00	8.08
Granite Point Mortgage Trust	$263.73 million	0.64	-$63.20 million	($3.86)	-0.88

Chicago Atlantic Real Estate Finance has higher earnings, but lower revenue than Granite Point Mortgage Trust. Granite Point 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.

Summary

Chicago Atlantic Real Estate Finance beats Granite Point Mortgage Trust on 11 of the 17 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 Granite Point Mortgage Trust

Granite Point Mortgage Trust Inc., a real estate investment trust, originates, invests in, and manages senior floating-rate commercial mortgage loans, and other debt and debt-like commercial real estate investments in the United States. The company provides intermediate-term bridge or transitional financing for various purposes, including acquisitions, recapitalizations, and refinancing, as well as a range of business plans, including lease-up, renovation, repositioning, and repurposing of the commercial property. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was founded in 2015 and is headquartered in New York, New York.