Head-To-Head Review: Paramount Group (PGRE) vs. Cherry Hill Mortgage Investment (CHMI)

Paramount Group (NYSE:PGRE) and Cherry Hill Mortgage Investment (NYSE:CHMI) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, valuation, dividends, profitability and analyst recommendations.

Institutional and Insider Ownership

68.6% of Paramount Group shares are owned by institutional investors. Comparatively, 59.7% of Cherry Hill Mortgage Investment shares are owned by institutional investors. 8.0% of Paramount Group shares are owned by company insiders. Comparatively, 1.1% of Cherry Hill Mortgage Investment shares are owned by company 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.

Dividends

Paramount Group pays an annual dividend of $0.40 per share and has a dividend yield of 2.8%. Cherry Hill Mortgage Investment pays an annual dividend of $1.96 per share and has a dividend yield of 11.3%. Paramount Group pays out 41.7% of its earnings in the form of a dividend. Cherry Hill Mortgage Investment pays out 87.1% 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 Ratings

This is a breakdown of recent recommendations and price targets for Paramount Group and Cherry Hill Mortgage Investment, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Paramount Group 0 2 2 0 2.50
Cherry Hill Mortgage Investment 0 0 2 0 3.00

Paramount Group presently has a consensus target price of $17.73, indicating a potential upside of 26.01%. Cherry Hill Mortgage Investment has a consensus target price of $19.50, indicating a potential upside of 12.65%. Given Paramount Group’s higher possible upside, analysts plainly believe Paramount Group is more favorable than Cherry Hill Mortgage Investment.

Earnings & Valuation

This table compares Paramount Group and Cherry Hill Mortgage Investment’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Paramount Group $758.96 million 4.35 $9.14 million $0.96 14.66
Cherry Hill Mortgage Investment $57.72 million 4.99 $37.28 million $2.25 7.69

Cherry Hill Mortgage Investment has lower revenue, but higher earnings than Paramount Group. Cherry Hill Mortgage Investment is trading at a lower price-to-earnings ratio than Paramount Group, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Paramount Group and Cherry Hill Mortgage Investment’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Paramount Group 1.21% 0.18% 0.10%
Cherry Hill Mortgage Investment 64.66% 12.07% 1.70%

Risk and Volatility

Paramount Group has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500. Comparatively, Cherry Hill Mortgage Investment has a beta of 0.35, indicating that its stock price is 65% less volatile than the S&P 500.

Summary

Cherry Hill Mortgage Investment beats Paramount Group on 8 of the 15 factors compared between the two stocks.

About Paramount Group

Headquartered in New York City, Paramount Group, Inc. is a fully-integrated real estate investment trust that owns, operates, manages, acquires and redevelops high-quality, Class A office properties located in select central business district submarkets of New York City, Washington, D.C. and San Francisco. Paramount is focused on maximizing the value of its portfolio by leveraging the sought-after locations of its assets and its proven property management capabilities to attract and retain high-quality tenants.

About Cherry Hill Mortgage Investment

Cherry Hill Mortgage Investment Corporation, a residential real estate finance company, acquires, invests in, and manages residential mortgage assets in the United States. The company operates through Investments in RMBS and Investments in Servicing Related Assets segments. It manages a portfolio of servicing related assets, residential mortgage-backed securities (RMBS), and prime residential mortgage loans, as well as other residential mortgage assets. 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. Cherry Hill Mortgage Investment Corporation was founded in 2012 and is based in Farmingdale, New Jersey.

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