Head-To-Head Comparison: MFA Financial (MFA) vs. Its Peers
MFA Financial (NYSE: MFA) is one of 35 public companies in the “Mortgage REITs” industry, but how does it compare to its peers? We will compare MFA Financial to related companies based on the strength of its dividends, valuation, risk, institutional ownership, earnings, analyst recommendations and profitability.
This table compares MFA Financial and its peers’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|MFA Financial Competitors||51.00%||9.77%||2.53%|
Institutional and Insider Ownership
80.2% of MFA Financial shares are owned by institutional investors. Comparatively, 57.0% of shares of all “Mortgage REITs” companies are owned by institutional investors. 0.9% of MFA Financial shares are owned by company insiders. Comparatively, 3.2% of shares of all “Mortgage REITs” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
MFA Financial pays an annual dividend of $0.80 per share and has a dividend yield of 9.6%. MFA Financial pays out 102.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Mortgage REITs” companies pay a dividend yield of 10.3% and pay out 82.1% of their earnings in the form of a dividend. MFA Financial lags its peers as a dividend stock, given its lower dividend yield and higher payout ratio.
Volatility and Risk
MFA Financial has a beta of 0.71, indicating that its stock price is 29% less volatile than the S&P 500. Comparatively, MFA Financial’s peers have a beta of 0.69, indicating that their average stock price is 31% less volatile than the S&P 500.
This is a summary of recent ratings for MFA Financial and its peers, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|MFA Financial Competitors||115||840||838||32||2.43|
MFA Financial currently has a consensus price target of $8.50, suggesting a potential upside of 1.67%. As a group, “Mortgage REITs” companies have a potential upside of 5.27%. Given MFA Financial’s peers stronger consensus rating and higher probable upside, analysts clearly believe MFA Financial has less favorable growth aspects than its peers.
Valuation & Earnings
This table compares MFA Financial and its peers revenue, earnings per share (EPS) and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|MFA Financial||$376.15 million||N/A||10.72|
|MFA Financial Competitors||$15.57 million||$2.95 million||6.59|
MFA Financial has higher revenue, but lower earnings than its peers. MFA Financial is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.
About MFA Financial
MFA Financial, Inc. is engaged in the real estate finance business. The Company’s subsidiaries invest in residential mortgage assets, including Non-Agency mortgage-backed securities (MBS), Agency MBS, residential whole loans and credit risk transfer (CRT) securities. The Company’s Non-Agency MBS portfolio primarily consists of Legacy Non-Agency MBS and 3 Year Step-up securities. In addition to Non-Agency MBS investments, the Company invests in re-performing and non-performing residential whole loans through its interests in certain consolidated trusts. The mortgages collateralizing its Agency MBS portfolio are predominantly Hybrids, 15-year fixed-rate mortgages and adjustable-rate mortgages (ARMs).
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