Adamas Trust (NASDAQ:ADAM – Get Free Report) and Chicago Atlantic Real Estate Finance (NASDAQ:REFI – Get Free Report) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, profitability, institutional ownership, analyst recommendations, risk, earnings and dividends.
Risk & Volatility
Adamas Trust has a beta of 1.18, suggesting that its share price is 18% more volatile than the S&P 500. Comparatively, Chicago Atlantic Real Estate Finance has a beta of 0.26, suggesting that its share price is 74% less volatile than the S&P 500.
Valuation and Earnings
This table compares Adamas Trust and Chicago Atlantic Real Estate Finance”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Adamas Trust | $601.95 million | 1.16 | $149.05 million | $1.68 | 4.63 |
| Chicago Atlantic Real Estate Finance | $55.39 million | 4.63 | $36.01 million | $1.37 | 7.31 |
Adamas Trust has higher revenue and earnings than Chicago Atlantic Real Estate Finance. Adamas Trust is trading at a lower price-to-earnings ratio than Chicago Atlantic Real Estate Finance, indicating that it is currently the more affordable of the two stocks.
Dividends
Adamas Trust pays an annual dividend of $1.20 per share and has a dividend yield of 15.4%. Chicago Atlantic Real Estate Finance pays an annual dividend of $1.88 per share and has a dividend yield of 18.8%. Adamas Trust pays out 71.4% of its earnings in the form of a dividend. Chicago Atlantic Real Estate Finance pays out 137.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Chicago Atlantic Real Estate Finance has increased its dividend for 1 consecutive years. Chicago Atlantic Real Estate Finance is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Insider and Institutional Ownership
54.9% of Adamas Trust shares are held by institutional investors. Comparatively, 25.5% of Chicago Atlantic Real Estate Finance shares are held by institutional investors. 2.0% of Adamas Trust shares are held by insiders. Comparatively, 6.5% of Chicago Atlantic Real Estate Finance shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Profitability
This table compares Adamas Trust and Chicago Atlantic Real Estate Finance’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Adamas Trust | 29.82% | 14.72% | 1.04% |
| Chicago Atlantic Real Estate Finance | 54.57% | 11.53% | 8.06% |
Analyst Recommendations
This is a summary of recent ratings and recommmendations for Adamas Trust and Chicago Atlantic Real Estate Finance, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Adamas Trust | 0 | 5 | 1 | 0 | 2.17 |
| Chicago Atlantic Real Estate Finance | 0 | 3 | 2 | 0 | 2.40 |
Adamas Trust currently has a consensus price target of $9.50, indicating a potential upside of 22.11%. Chicago Atlantic Real Estate Finance has a consensus price target of $15.33, indicating a potential upside of 53.03%. Given Chicago Atlantic Real Estate Finance’s stronger consensus rating and higher probable upside, analysts clearly believe Chicago Atlantic Real Estate Finance is more favorable than Adamas Trust.
Summary
Chicago Atlantic Real Estate Finance beats Adamas Trust on 10 of the 17 factors compared between the two stocks.
About Adamas Trust
New York Mortgage Trust, Inc. acquires, invests in, finances, and manages mortgage-related single-family and multi-family residential assets in the United States. Its targeted investments include residential loans, second mortgages, and business purpose loans; structured multi-family property investments, such as preferred equity in, and mezzanine loans to owners of multi-family properties, as well as joint venture equity investments in multi-family properties; non-agency residential mortgage-backed securities (RMBS); agency RMBS; commercial mortgage-backed securities (CMBS); and other mortgage, residential housing, and credit-related 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. The company was incorporated in 2003 and is headquartered in New York, New York.
About Chicago Atlantic Real Estate Finance
Chicago Atlantic Real Estate Finance, Inc. operates as a commercial real estate finance company in the United States. The company engages in originating, structuring, and investing in first mortgage loans and alternative structured financings secured by commercial real estate properties. Its portfolio primarily includes offers senior loans to state-licensed operators in the cannabis industry. The company has elected to be taxed as a real estate investment trust (REIT) and would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. Chicago Atlantic Real Estate Finance, Inc. was incorporated in 2021 and is headquartered in Chicago, Illinois.
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