Federal Agricultural Mortgage Corp. (NYSE: AGM.A) and Monroe Capital Corporation (NASDAQ:MRCC) are both financials companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, risk, institutional ownership, profitabiliy and earnings.
Valuation and Earnings
This table compares Federal Agricultural Mortgage Corp. and Monroe Capital Corporation’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Federal Agricultural Mortgage Corp.||N/A||N/A||N/A||N/A||N/A|
|Monroe Capital Corporation||N/A||N/A||N/A||$1.24||11.44|
Institutional and Insider Ownership
27.8% of Monroe Capital Corporation shares are owned by institutional investors. 1.9% of Monroe Capital Corporation shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
This is a breakdown of current recommendations and price targets for Federal Agricultural Mortgage Corp. and Monroe Capital Corporation, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Federal Agricultural Mortgage Corp.||0||0||0||0||N/A|
|Monroe Capital Corporation||0||2||4||0||2.67|
Monroe Capital Corporation has a consensus target price of $17.13, suggesting a potential upside of 20.77%.
Monroe Capital Corporation pays an annual dividend of $1.40 per share and has a dividend yield of 9.9%. Federal Agricultural Mortgage Corp. does not pay a dividend. Monroe Capital Corporation pays out 112.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
This table compares Federal Agricultural Mortgage Corp. and Monroe Capital Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Federal Agricultural Mortgage Corp.||24.06%||16.60%||0.56%|
|Monroe Capital Corporation||41.75%||10.23%||5.77%|
Monroe Capital Corporation beats Federal Agricultural Mortgage Corp. on 6 of the 8 factors compared between the two stocks.
Federal Agricultural Mortgage Corp. Company Profile
Federal Agricultural Mortgage Corporation (Farmer Mac) provides a secondary market for a range of loans made to borrowers in rural America. The Company’s segments include Farm & Ranch, USDA Guarantees, Rural Utilities, Institutional Credit and Corporate. Its secondary market activities are purchasing eligible loans directly from lenders; providing advances against eligible loans by purchasing obligations secured by those loans; securitizing assets and guaranteeing the payment of principal and interest on the resulting securities that represent interests in, or obligations secured by, pools of eligible loans; and issuing long-term standby purchase commitments (LTSPCs) for eligible loans. The loans eligible for the secondary market provided by Farmer Mac include mortgage loans secured by first liens on agricultural real estate, including part-time farms and rural housing (comprising the assets eligible for the Farm & Ranch line of business).
Monroe Capital Corporation Company Profile
Monroe Capital Corporation is a closed-end, non-diversified management investment company. The Company is a specialty finance company focused on providing financing primarily to lower middle-market companies in the United States and Canada. The Company’s investment objective is to maximize the total return to its stockholders in the form of current income and capital appreciation primarily through investments in senior, unitranche and junior secured debt, and unsecured subordinated debt and equity. The Company provides customized financing solutions focused primarily on senior secured, junior secured and unitranche (a combination of senior secured and junior secured debt in the same facility) debt, and subordinated debt and equity, including equity co-investments in preferred and common stock and warrants. The Company’s investment activities are managed by its investment advisor, Monroe Capital BDC Advisors, LLC (MC Advisors).
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