CYS Investments (NYSE: CYS) and Ladder Capital (NYSE:LADR) are both small-cap financials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, profitability, valuation, dividends, analyst recommendations and risk.
This table compares CYS Investments and Ladder Capital’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This table compares CYS Investments and Ladder Capital’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|CYS Investments||$294.54 million||4.05||$16.39 million||($0.20)||-38.45|
|Ladder Capital||$399.68 million||3.77||$66.72 million||$0.87||15.62|
Ladder Capital has higher revenue and earnings than CYS Investments. CYS Investments is trading at a lower price-to-earnings ratio than Ladder Capital, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
62.2% of CYS Investments shares are owned by institutional investors. Comparatively, 46.2% of Ladder Capital shares are owned by institutional investors. 1.0% of CYS Investments shares are owned by insiders. Comparatively, 12.5% of Ladder Capital shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Risk and Volatility
CYS Investments has a beta of 0.62, indicating that its stock price is 38% less volatile than the S&P 500. Comparatively, Ladder Capital has a beta of 1.03, indicating that its stock price is 3% more volatile than the S&P 500.
This is a breakdown of current recommendations for CYS Investments and Ladder Capital, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
CYS Investments presently has a consensus target price of $8.25, suggesting a potential upside of 7.28%. Ladder Capital has a consensus target price of $16.25, suggesting a potential upside of 19.57%. Given Ladder Capital’s stronger consensus rating and higher probable upside, analysts clearly believe Ladder Capital is more favorable than CYS Investments.
CYS Investments pays an annual dividend of $1.00 per share and has a dividend yield of 13.0%. Ladder Capital pays an annual dividend of $1.26 per share and has a dividend yield of 9.3%. CYS Investments pays out -500.0% of its earnings in the form of a dividend. Ladder Capital pays out 144.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ladder Capital has increased its dividend for 2 consecutive years. CYS Investments is clearly the better dividend stock, given its higher yield and lower payout ratio.
Ladder Capital beats CYS Investments on 10 of the 17 factors compared between the two stocks.
CYS Investments Company Profile
CYS Investments, Inc. is a specialty finance company. The Company’s objective is to provide consistent returns to its investors through a combination of dividends and capital appreciation. It invests in agency residential mortgage-backed security (RMBS) collateralized by fixed rate single-family residential mortgage loans; adjustable-rate mortgages (ARMs), which have coupon rates that reset monthly, or hybrid ARMs, which have a coupon rate that is fixed for an initial period. In addition, it has investments in collateralized mortgage obligations issued by a government agency or government-sponsored entity (GSE) that are collateralized by Agency RMBS. Its investments consist of residential mortgage pass-through securities for which the principal and interest payments are guaranteed by a GSE, such as Federal National Mortgage Association and Federal Home Loan Mortgage Corporation, or by the United States Government agency, such as Government National Mortgage Association.
Ladder Capital Company Profile
Ladder Capital Corp is a commercial real estate finance company. The Company’s segments include loans, securities, real estate and corporate/other. The loans segment includes mortgage loan receivables held for investment (balance sheet loans) and mortgage loan receivables held for sale (conduit loans). The securities segment consists of all of its activities related to commercial real estate securities, which include investments in commercial mortgage-backed securities (CMBS) and United States Agency Securities. The real estate segment includes net leased properties, office buildings, a warehouse and condominium units. The Corporate/other segment includes the Company’s investments in joint ventures, other asset management activities and operating expenses. The Company invests primarily in loans, securities and other interests in the United States commercial real estate, with a focus on senior secured assets.
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