CTO Realty Growth (NYSE:CTO – Get Free Report) and NexPoint Real Estate Finance (NYSE:NREF – Get Free Report) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, risk, analyst recommendations, earnings, dividends, profitability and institutional ownership.
Dividends
CTO Realty Growth pays an annual dividend of $1.52 per share and has a dividend yield of 8.9%. NexPoint Real Estate Finance pays an annual dividend of $2.00 per share and has a dividend yield of 15.1%. CTO Realty Growth pays out 276.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NexPoint Real Estate Finance pays out -363.6% of its earnings in the form of a dividend. CTO Realty Growth has raised its dividend for 2 consecutive years and NexPoint Real Estate Finance has raised its dividend for 1 consecutive years. NexPoint Real Estate Finance is clearly the better dividend stock, given its higher yield and lower payout ratio.
Profitability
This table compares CTO Realty Growth and NexPoint Real Estate Finance’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| CTO Realty Growth | 15.43% | 3.68% | 1.67% |
| NexPoint Real Estate Finance | 23.44% | 3.70% | 0.18% |
Risk & Volatility
Analyst Recommendations
This is a breakdown of recent ratings for CTO Realty Growth and NexPoint Real Estate Finance, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| CTO Realty Growth | 0 | 0 | 4 | 0 | 3.00 |
| NexPoint Real Estate Finance | 0 | 1 | 0 | 1 | 3.00 |
CTO Realty Growth currently has a consensus price target of $20.00, indicating a potential upside of 17.51%. NexPoint Real Estate Finance has a consensus price target of $16.50, indicating a potential upside of 24.91%. Given NexPoint Real Estate Finance’s higher possible upside, analysts clearly believe NexPoint Real Estate Finance is more favorable than CTO Realty Growth.
Institutional & Insider Ownership
67.2% of CTO Realty Growth shares are owned by institutional investors. Comparatively, 67.8% of NexPoint Real Estate Finance shares are owned by institutional investors. 5.0% of CTO Realty Growth shares are owned by insiders. Comparatively, 54.0% of NexPoint Real Estate Finance shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Valuation and Earnings
This table compares CTO Realty Growth and NexPoint Real Estate Finance’s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| CTO Realty Growth | $109.12 million | 3.58 | $5.53 million | $0.55 | 30.95 |
| NexPoint Real Estate Finance | $68.36 million | 3.40 | $13.98 million | ($0.55) | -24.02 |
NexPoint Real Estate Finance has lower revenue, but higher earnings than CTO Realty Growth. NexPoint Real Estate Finance is trading at a lower price-to-earnings ratio than CTO Realty Growth, indicating that it is currently the more affordable of the two stocks.
Summary
NexPoint Real Estate Finance beats CTO Realty Growth on 10 of the 17 factors compared between the two stocks.
About CTO Realty Growth
CTO Realty Growth, Inc. is a publicly traded real estate investment trust that owns and operates a portfolio of high-quality, retail-based properties located primarily in higher growth markets in the United States. CTO also externally manages and owns a meaningful interest in Alpine Income Property Trust, Inc. (NYSE: PINE), a publicly traded net lease REIT.
About NexPoint Real Estate Finance
NexPoint Real Estate Finance, Inc. operates as a commercial mortgage real estate investment trust in the United States. It focuses on originating, structuring, and investing in first-lien mortgage loans, mezzanine loans, preferred equity, convertible notes, multifamily properties, and common equity investments, as well as multifamily and single-family rental commercial mortgage-backed securities securitizations, multifamily structured credit risk notes, and mortgage-backed securities or target assets. 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. NexPoint Real Estate Finance, Inc. was incorporated in 2019 and is based in Dallas, Texas.
Receive News & Ratings for CTO Realty Growth Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for CTO Realty Growth and related companies with MarketBeat.com's FREE daily email newsletter.
