Critical Analysis: Ellington Financial (EFC) vs. Its Peers
Ellington Financial (NYSE: EFC) is one of 26 public companies in the “Retail & Mortgage Banks” industry, but how does it weigh in compared to its competitors? We will compare Ellington Financial to similar companies based on the strength of its analyst recommendations, risk, profitability, institutional ownership, dividends, valuation and earnings.
Volatility and Risk
Ellington Financial has a beta of 0.43, suggesting that its stock price is 57% less volatile than the S&P 500. Comparatively, Ellington Financial’s competitors have a beta of 0.83, suggesting that their average stock price is 17% less volatile than the S&P 500.
Earnings and Valuation
This table compares Ellington Financial and its competitors revenue, earnings per share and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|Ellington Financial||$69.62 million||N/A||22.46|
|Ellington Financial Competitors||$678.45 million||$169.32 million||12.22|
Ellington Financial’s competitors have higher revenue and earnings than Ellington Financial. Ellington Financial is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.
This is a summary of recent ratings and recommmendations for Ellington Financial and its competitors, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Ellington Financial Competitors||161||565||524||23||2.32|
Ellington Financial currently has a consensus target price of $18.75, indicating a potential upside of 19.27%. As a group, “Retail & Mortgage Banks” companies have a potential upside of 27.05%. Given Ellington Financial’s competitors higher probable upside, analysts plainly believe Ellington Financial has less favorable growth aspects than its competitors.
This table compares Ellington Financial and its competitors’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Ellington Financial Competitors||14.79%||-27.48%||0.87%|
Insider and Institutional Ownership
50.5% of Ellington Financial shares are owned by institutional investors. Comparatively, 54.7% of shares of all “Retail & Mortgage Banks” companies are owned by institutional investors. 10.6% of Ellington Financial shares are owned by insiders. Comparatively, 12.8% of shares of all “Retail & Mortgage Banks” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Ellington Financial pays an annual dividend of $1.80 per share and has a dividend yield of 11.5%. Ellington Financial pays out 257.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Retail & Mortgage Banks” companies pay a dividend yield of 1.6% and pay out 28.4% of their earnings in the form of a dividend.
Ellington Financial Company Profile
Ellington Financial LLC is a specialty finance company that acquires and manages mortgage-related and other financial assets. The Company’s targeted assets include residential mortgage-backed securities (RMBS), backed by loans for which the principal and interest payments are not guaranteed by a United States Government agency or a United States Government-sponsored entity, collectively referred to as non-Agency RMBS; RMBS for which the principal and interest payments are guaranteed by the United States government agency or the United States government-sponsored entity (Agency RMBS); consumer loans and asset-backed securities (ABS) backed by consumer loans; commercial mortgage-backed securities (CMBS) commercial mortgage loans and other commercial real estate debt; residential mortgage loans; collateralized loan obligations (CLOs); corporate debt and equity, including distressed debt and equity, and mortgage-related derivatives.
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