Manhattan Bridge Capital (NASDAQ:LOAN – Get Free Report) and Adamas Trust (NASDAQ:ADAM – Get Free Report) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, dividends, earnings, risk and institutional ownership.
Profitability
This table compares Manhattan Bridge Capital and Adamas Trust’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Manhattan Bridge Capital | 58.61% | 11.12% | 7.54% |
| Adamas Trust | 29.82% | 14.72% | 1.04% |
Earnings & Valuation
This table compares Manhattan Bridge Capital and Adamas Trust”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Manhattan Bridge Capital | $8.67 million | 4.60 | $5.11 million | $0.42 | 8.31 |
| Adamas Trust | $601.95 million | 1.15 | $149.05 million | $1.68 | 4.60 |
Adamas Trust has higher revenue and earnings than Manhattan Bridge Capital. Adamas Trust is trading at a lower price-to-earnings ratio than Manhattan Bridge Capital, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
21.8% of Manhattan Bridge Capital shares are held by institutional investors. Comparatively, 54.9% of Adamas Trust shares are held by institutional investors. 24.6% of Manhattan Bridge Capital shares are held by company insiders. Comparatively, 2.0% of Adamas Trust shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Risk & Volatility
Manhattan Bridge Capital has a beta of 0.2, indicating that its share price is 80% less volatile than the S&P 500. Comparatively, Adamas Trust has a beta of 1.22, indicating that its share price is 22% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current ratings for Manhattan Bridge Capital and Adamas Trust, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Manhattan Bridge Capital | 1 | 1 | 0 | 0 | 1.50 |
| Adamas Trust | 0 | 5 | 1 | 0 | 2.17 |
Adamas Trust has a consensus price target of $9.50, indicating a potential upside of 22.90%. Given Adamas Trust’s stronger consensus rating and higher probable upside, analysts plainly believe Adamas Trust is more favorable than Manhattan Bridge Capital.
Dividends
Manhattan Bridge Capital pays an annual dividend of $0.44 per share and has a dividend yield of 12.6%. Adamas Trust pays an annual dividend of $1.20 per share and has a dividend yield of 15.5%. Manhattan Bridge Capital pays out 104.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Adamas Trust pays out 71.4% of its earnings in the form of a dividend. Manhattan Bridge Capital has increased its dividend for 1 consecutive years. Adamas Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.
Summary
Adamas Trust beats Manhattan Bridge Capital on 11 of the 17 factors compared between the two stocks.
About Manhattan Bridge Capital
Manhattan Bridge Capital, Inc., a real estate finance company, originates, services, and manages a portfolio of first mortgage loans in the United States. The company offers short-term, secured, and non-banking loans to real estate investors to fund acquisition, renovation, rehabilitation, or development of residential or commercial properties. Its loans are secured by collateral consisting of real estate and accompanied by personal guarantees from the principals of the borrowers. The company has elected to be taxed as a real estate investment trust. As a result, it would not be subject to corporate income tax on that portion of its net income that is distributed to shareholders. The company was founded in 1989 and is headquartered in Great Neck, New York.
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.
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