DX vs. RWT, NYMT, ARR, CIM, IVR, ACRE, MFA, PMT, TWO, and RC
Should you be buying Dynex Capital stock or one of its competitors? The main competitors of Dynex Capital include Redwood Trust (RWT), New York Mortgage Trust (NYMT), ARMOUR Residential REIT (ARR), Chimera Investment (CIM), Invesco Mortgage Capital (IVR), Ares Commercial Real Estate (ACRE), MFA Financial (MFA), PennyMac Mortgage Investment Trust (PMT), Two Harbors Investment (TWO), and Ready Capital (RC). These companies are all part of the "mortgage reits" industry.
Dynex Capital (NYSE:DX) and Redwood Trust (NYSE:RWT) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, media sentiment, risk, analyst recommendations, community ranking, earnings, dividends and profitability.
38.3% of Dynex Capital shares are held by institutional investors. Comparatively, 74.3% of Redwood Trust shares are held by institutional investors. 1.0% of Dynex Capital shares are held by company insiders. Comparatively, 2.5% of Redwood Trust shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Redwood Trust received 116 more outperform votes than Dynex Capital when rated by MarketBeat users. Likewise, 65.56% of users gave Redwood Trust an outperform vote while only 59.68% of users gave Dynex Capital an outperform vote.
Redwood Trust has higher revenue and earnings than Dynex Capital. Redwood Trust is trading at a lower price-to-earnings ratio than Dynex Capital, indicating that it is currently the more affordable of the two stocks.
Redwood Trust has a net margin of -0.28% compared to Dynex Capital's net margin of -2.95%. Redwood Trust's return on equity of 5.21% beat Dynex Capital's return on equity.
In the previous week, Dynex Capital had 10 more articles in the media than Redwood Trust. MarketBeat recorded 16 mentions for Dynex Capital and 6 mentions for Redwood Trust. Redwood Trust's average media sentiment score of 0.58 beat Dynex Capital's score of 0.22 indicating that Redwood Trust is being referred to more favorably in the news media.
Dynex Capital currently has a consensus price target of $13.31, suggesting a potential upside of 13.01%. Redwood Trust has a consensus price target of $7.64, suggesting a potential upside of 31.93%. Given Redwood Trust's stronger consensus rating and higher probable upside, analysts plainly believe Redwood Trust is more favorable than Dynex Capital.
Dynex Capital has a beta of 1.33, suggesting that its stock price is 33% more volatile than the S&P 500. Comparatively, Redwood Trust has a beta of 1.48, suggesting that its stock price is 48% more volatile than the S&P 500.
Dynex Capital pays an annual dividend of $1.56 per share and has a dividend yield of 13.3%. Redwood Trust pays an annual dividend of $0.64 per share and has a dividend yield of 11.0%. Dynex Capital pays out -557.1% of its earnings in the form of a dividend. Redwood Trust pays out -533.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Dynex Capital is clearly the better dividend stock, given its higher yield and lower payout ratio.
Summary
Redwood Trust beats Dynex Capital on 16 of the 21 factors compared between the two stocks.
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This chart shows the number of new MarketBeat users adding DX and its top 5 competitors to their watchlist. Each company is represented with a line over a 90 day period.
This chart shows the average media sentiment of NYSE and its competitors over the past 90 days as caculated by MarketBeat. The averaged score is equivalent to the following: Very Negative Sentiment <= -1.5, Negative Sentiment > -1.5 and <= -0.5, Neutral Sentiment > -0.5 and < 0.5, Positive Sentiment >= 0.5 and < 1.5, and Very Positive Sentiment >= 1.5.
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