Chicago Atlantic Real Estate Finance (NASDAQ:REFI – Get Free Report) and Paramount Group (NYSE:PGRE – Get Free Report) are both small-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, institutional ownership, risk, analyst recommendations and valuation.
Profitability
This table compares Chicago Atlantic Real Estate Finance and Paramount Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Chicago Atlantic Real Estate Finance | 63.27% | 13.29% | 10.10% |
| Paramount Group | -27.96% | -5.15% | -2.64% |
Insider & Institutional Ownership
25.5% of Chicago Atlantic Real Estate Finance shares are owned by institutional investors. Comparatively, 65.6% of Paramount Group shares are owned by institutional investors. 12.3% of Chicago Atlantic Real Estate Finance shares are owned by insiders. Comparatively, 13.5% of Paramount Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Chicago Atlantic Real Estate Finance | 0 | 0 | 1 | 1 | 3.50 |
| Paramount Group | 2 | 2 | 1 | 0 | 1.80 |
Chicago Atlantic Real Estate Finance presently has a consensus target price of $20.00, suggesting a potential upside of 26.90%. Paramount Group has a consensus target price of $4.70, suggesting a potential downside of 6.37%. Given Chicago Atlantic Real Estate Finance’s stronger consensus rating and higher probable upside, analysts plainly believe Chicago Atlantic Real Estate Finance is more favorable than Paramount Group.
Volatility and Risk
Chicago Atlantic Real Estate Finance has a beta of 0.2, indicating that its stock price is 80% less volatile than the S&P 500. Comparatively, Paramount Group has a beta of 1.25, indicating that its stock price is 25% more volatile than the S&P 500.
Dividends
Chicago Atlantic Real Estate Finance pays an annual dividend of $1.88 per share and has a dividend yield of 11.9%. Paramount Group pays an annual dividend of $0.14 per share and has a dividend yield of 2.8%. Chicago Atlantic Real Estate Finance pays out 94.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Paramount Group pays out -12.1% of its earnings in the form of a dividend.
Valuation and Earnings
This table compares Chicago Atlantic Real Estate Finance and Paramount Group”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Chicago Atlantic Real Estate Finance | $55.17 million | 5.46 | $38.71 million | $1.99 | 7.92 |
| Paramount Group | $757.94 million | 1.44 | -$259.74 million | ($1.16) | -4.33 |
Chicago Atlantic Real Estate Finance has higher earnings, but lower revenue than Paramount Group. Paramount Group 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.
Summary
Chicago Atlantic Real Estate Finance beats Paramount Group on 11 of the 16 factors compared between the two stocks.
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.
About Paramount Group
Paramount Group, Inc. ("Paramount" or the "Company") is a fully-integrated real estate investment trust that owns, operates, manages, acquires and redevelops high-quality, Class A office properties located in select central business district submarkets of New York and San Francisco. Paramount is focused on maximizing the value of its portfolio by leveraging the sought-after locations of its assets and its proven property management capabilities to attract and retain high-quality tenants.
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