Head to Head Analysis: Great Ajax (NYSE:AJX) and HG (OTCMKTS:STLY)

Great Ajax (NYSE:AJX) and HG (OTCMKTS:STLY) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, risk, analyst recommendations, dividends, institutional ownership and profitability.

Valuation & Earnings

This table compares Great Ajax and HG”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Great Ajax	-$89.73 million	0.00	-$47.07 million	($3.77)	N/A
HG	$11.11 million	1.23	-$820,000.00	($0.15)	-31.67

HG has higher revenue and earnings than Great Ajax. HG is trading at a lower price-to-earnings ratio than Great Ajax, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Great Ajax and HG’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Great Ajax	-203.61%	-8.35%	-1.99%
HG	-3.70%	-1.31%	-0.92%

Insider and Institutional Ownership

58.6% of Great Ajax shares are held by institutional investors. Comparatively, 1.7% of HG shares are held by institutional investors. 2.3% of Great Ajax shares are held by insiders. Comparatively, 36.1% of HG shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Risk and Volatility

Great Ajax has a beta of 1.88, meaning that its stock price is 88% more volatile than the S&P 500. Comparatively, HG has a beta of 0.56, meaning that its stock price is 44% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings for Great Ajax and HG, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Great Ajax	0	2	1	0	2.33
HG	0	0	0	0	0.00

Great Ajax currently has a consensus target price of $6.00, indicating a potential upside of 0.00%. Given Great Ajax’s stronger consensus rating and higher probable upside, analysts plainly believe Great Ajax is more favorable than HG.

Summary

HG beats Great Ajax on 7 of the 13 factors compared between the two stocks.

About Great Ajax

Great Ajax Corp. operates as a mortgage real estate investment trust. It acquires re-performing and non-performing loans; acquires or originates small balance commercial mortgage loans that are secured by multi-family residential and commercial mixed use retail/residential properties; and invests in single-family and smaller commercial properties. The company elected to be taxed as a real estate investment trust for U.S. federal income tax purposes. Great Ajax Corp. was incorporated in 2014 and is based in Tigard, Oregon.

About HG

HG Holdings, Inc. engages in the title insurance and real estate businesses in the United States. It operates through four segments: Title Insurance Services, Reinsurance, Management Services, and Real Estate. The company provides title insurance, closing and/or escrow, and similar or related services in connection with residential and commercial real estate transactions. It also owns and operates a portfolio of single-tenant properties leased for the occupancy by U.S. government tenant agencies and sub-agencies, such as the Federal Bureau of Investigation, the Department of Veterans affairs, the Drug Enforcement Administration, Immigration & Customs Enforcement, the Social Security Administration, and the Department of Transportation. In addition, the company provides excess-of-loss reinsurance coverage related to catastrophic weather risk in Texas; and management advisory services, such as formation, operational, and restructuring services. The company was formerly known as Stanley Furniture Company, Inc. and changed its name to HG Holdings, Inc. in March 2018. HG Holdings, Inc. was incorporated in 1984 and is headquartered in Charlotte, North Carolina.