Contrasting CV (OTCMKTS:CVHL) and ARMOUR Residential REIT (NYSE:ARR)

CV (OTCMKTS:CVHL) and ARMOUR Residential REIT (NYSE:ARR) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, profitability, institutional ownership, earnings, risk, dividends and analyst recommendations.

Insider and Institutional Ownership

54.2% of ARMOUR Residential REIT shares are owned by institutional investors. 7.6% of CV shares are owned by company insiders. Comparatively, 0.2% of ARMOUR Residential REIT shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings and price targets for CV and ARMOUR Residential REIT, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CV	0	0	0	0	0.00
ARMOUR Residential REIT	1	6	1	0	2.00

ARMOUR Residential REIT has a consensus price target of $16.00, suggesting a potential downside of 4.96%. Given ARMOUR Residential REIT’s stronger consensus rating and higher probable upside, analysts plainly believe ARMOUR Residential REIT is more favorable than CV.

Risk and Volatility

CV has a beta of 1.07, suggesting that its share price is 7% more volatile than the S&P 500. Comparatively, ARMOUR Residential REIT has a beta of 1.44, suggesting that its share price is 44% more volatile than the S&P 500.

Earnings & Valuation

This table compares CV and ARMOUR Residential REIT”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CV	$25.67 million	0.02	-$18.15 million	N/A	N/A
ARMOUR Residential REIT	$550.95 million	3.42	-$14.39 million	$0.04	420.88

ARMOUR Residential REIT has higher revenue and earnings than CV.

Profitability

This table compares CV and ARMOUR Residential REIT’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CV	N/A	N/A	N/A
ARMOUR Residential REIT	9.01%	15.37%	1.63%

Summary

ARMOUR Residential REIT beats CV on 11 of the 12 factors compared between the two stocks.

About CV

CV Holdings, Inc. operates as a specialty finance company. It owns finance platforms across various businesses, including small-ticket equipment financing and commercial real estate bridge lending. CV Holdings, Inc. was incorporated in 2005 and is based in Newport Beach, California.

About ARMOUR Residential REIT

ARMOUR Residential REIT, Inc. invests in residential mortgage-backed securities (MBS) in the United States. Its securities portfolio primarily consists of the United States Government-sponsored entity's (GSE) and the Government National Mortgage Administration's issued or guaranteed securities backed by fixed rate, hybrid adjustable rate, and adjustable-rate home loans; and unsecured notes and bonds issued by the GSE and the United States treasuries, as well as money market instruments. 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. ARMOUR Residential REIT, Inc. was incorporated in 2008 and is based in Vero Beach, Florida.