Head-To-Head Analysis: Ready Capital (RC) versus The Competition

Ready Capital (NYSE:RC) is one of 52 public companies in the “Mortgage Real Estate Investment Trusts (REITs)” industry, but how does it contrast to its peers? We will compare Ready Capital to similar businesses based on the strength of its institutional ownership, profitability, analyst recommendations, valuation, dividends, earnings and risk.

Volatility & Risk

Ready Capital has a beta of 1.55, meaning that its share price is 55% more volatile than the S&P 500. Comparatively, Ready Capital’s peers have a beta of 1.21, meaning that their average share price is 21% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and price targets for Ready Capital and its peers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ready Capital	2	3	0	0	1.60
Ready Capital Competitors	691	1992	2139	136	2.35

Ready Capital presently has a consensus target price of $1.17, indicating a potential upside of 26.13%. As a group, “Mortgage Real Estate Investment Trusts (REITs)” companies have a potential upside of 54.53%. Given Ready Capital’s peers stronger consensus rating and higher possible upside, analysts plainly believe Ready Capital has less favorable growth aspects than its peers.

Institutional & Insider Ownership

55.9% of Ready Capital shares are owned by institutional investors. Comparatively, 52.3% of shares of all “Mortgage Real Estate Investment Trusts (REITs)” companies are owned by institutional investors. 1.4% of Ready Capital shares are owned by insiders. Comparatively, 4.8% of shares of all “Mortgage Real Estate Investment Trusts (REITs)” companies are owned 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.

Dividends

Ready Capital pays an annual dividend of $0.04 per share and has a dividend yield of 4.3%. Ready Capital pays out -1.1% of its earnings in the form of a dividend. As a group, “Mortgage Real Estate Investment Trusts (REITs)” companies pay a dividend yield of 17.4% and pay out -110.1% of their earnings in the form of a dividend. Ready Capital lags its peers as a dividend stock, given its lower dividend yield and higher payout ratio.

Valuation and Earnings

This table compares Ready Capital and its peers revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Ready Capital	$569.17 million	-$228.91 million	-0.25
Ready Capital Competitors	$762.88 million	$157.00 million	18.22

Ready Capital’s peers have higher revenue and earnings than Ready Capital. Ready Capital is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Ready Capital and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ready Capital	-163.95%	-9.25%	-1.86%
Ready Capital Competitors	-13.29%	7.67%	1.05%

Summary

Ready Capital peers beat Ready Capital on 12 of the 14 factors compared.

Ready Capital Company Profile

Ready Capital Corporation is a real estate finance company focused on commercial real estate lending. It originates, acquires, finances and services loans secured by commercial properties, including bridge and construction loans for property owners and investors. The company also invests in commercial real estate-related assets and provides financing through programs such as Small Business Administration lending. Its activities serve borrowers and property owners across the United States. Ready Capital is externally managed by Waterfall Asset Management and trades on the New York Stock Exchange under the symbol RC.