TPG RE Finance Trust (NYSE:TRTX) versus AGNC Investment (NASDAQ:AGNCN) Critical Analysis

AGNC Investment (NASDAQ:AGNCN) and TPG RE Finance Trust (NYSE:TRTX) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their dividends, profitability, valuation, institutional ownership, risk, earnings and analyst recommendations.

Insider & Institutional Ownership

57.1% of TPG RE Finance Trust shares are held by institutional investors. 3.0% of TPG RE Finance Trust shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares AGNC Investment and TPG RE Finance Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
AGNC Investment	N/A	N/A	N/A
TPG RE Finance Trust	17.03%	6.85%	1.66%

Dividends

AGNC Investment pays an annual dividend of $1.75 per share and has a dividend yield of 6.7%. TPG RE Finance Trust pays an annual dividend of $0.96 per share and has a dividend yield of 12.1%. TPG RE Finance Trust pays out 177.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for AGNC Investment and TPG RE Finance Trust, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AGNC Investment	0	0	0	0	0.00
TPG RE Finance Trust	0	2	4	0	2.67

TPG RE Finance Trust has a consensus target price of $10.00, suggesting a potential upside of 26.07%. Given TPG RE Finance Trust’s stronger consensus rating and higher probable upside, analysts plainly believe TPG RE Finance Trust is more favorable than AGNC Investment.

Earnings & Valuation

This table compares AGNC Investment and TPG RE Finance Trust”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AGNC Investment	$2.40 billion	N/A	N/A	N/A	N/A
TPG RE Finance Trust	$332.58 million	1.83	$60.32 million	$0.54	14.69

TPG RE Finance Trust has lower revenue, but higher earnings than AGNC Investment.

Summary

TPG RE Finance Trust beats AGNC Investment on 9 of the 11 factors compared between the two stocks.

About AGNC Investment

AGNC Investment Corp. provides private capital to housing market in the United States. It invests in residential mortgage pass-through securities and collateralized mortgage obligations for which the principal and interest payments are guaranteed by the United States government-sponsored enterprise or by the United States government agency. 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 formerly known as American Capital Agency Corp. and changed its name to AGNC Investment Corp. in September 2016. AGNC Investment Corp. was incorporated in 2008 and is headquartered in Bethesda, Maryland.

About TPG RE Finance Trust

TPG RE Finance Trust, Inc., a commercial real estate finance company, originates, acquires, and manages commercial mortgage loans and other commercial real estate-related debt instruments in the United States. It invests in commercial mortgage loans; subordinate mortgage interests, mezzanine loans, secured real estate securities, note financing, preferred equity, and miscellaneous debt instruments; and commercial real estate collateralized loan obligations and commercial mortgage-backed securities secured by properties primarily in the multifamily, life science, mixed-use, hospitality, self storage, industrial, and retail real estate sectors. 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. TPG RE Finance Trust, Inc. was incorporated in 2014 and is based in New York, New York.