Reviewing Trinity Capital (NASDAQ:TRIN) and Elme Communities (NYSE:ELME)

Trinity Capital (NASDAQ:TRIN) and Elme Communities (NYSE:ELME) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, profitability, dividends, risk, valuation, earnings and institutional ownership.

Institutional & Insider Ownership

24.6% of Trinity Capital shares are held by institutional investors. Comparatively, 87.9% of Elme Communities shares are held by institutional investors. 4.3% of Trinity Capital shares are held by company insiders. Comparatively, 1.4% of Elme Communities shares are held by company 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.

Earnings and Valuation

This table compares Trinity Capital and Elme Communities”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Trinity Capital	$216.31 million	7.61	$135.60 million	$1.75	9.94
Elme Communities	$206.36 million	0.76	-$154.16 million	($1.52)	-1.15

Trinity Capital has higher revenue and earnings than Elme Communities. Elme Communities is trading at a lower price-to-earnings ratio than Trinity Capital, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Trinity Capital and Elme Communities, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Trinity Capital	1	1	4	1	2.71
Elme Communities	1	2	0	0	1.67

Trinity Capital presently has a consensus target price of $16.67, suggesting a potential downside of 4.19%. Elme Communities has a consensus target price of $18.00, suggesting a potential upside of 925.64%. Given Elme Communities’ higher probable upside, analysts clearly believe Elme Communities is more favorable than Trinity Capital.

Profitability

This table compares Trinity Capital and Elme Communities’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Trinity Capital	43.45%	14.94%	6.69%
Elme Communities	N/A	N/A	N/A

Risk and Volatility

Trinity Capital has a beta of 0.63, meaning that its stock price is 37% less volatile than the S&P 500. Comparatively, Elme Communities has a beta of 0.73, meaning that its stock price is 27% less volatile than the S&P 500.

Summary

Trinity Capital beats Elme Communities on 12 of the 15 factors compared between the two stocks.

About Trinity Capital

Trinity Capital Inc. is a business development company. It is a venture capital firm specializing in venture debt to growth stage companies looking for loans and/or equipment financing. Trinity Capital Inc. was founded in 2019 is based in Phoenix, Arizona with additional offices in the United States.

About Elme Communities

Elme Communities is committed to elevating what home can be for middle-income renters by providing a higher level of quality, service, and experience. The Company is a multifamily real estate investment trust that owns and operates approximately 9,400 apartment homes in the Washington, DC metro and the Atlanta metro regions, and owns approximately 300,000 square feet of commercial space. Focused on providing quality, affordable homes to a deep, solid, and underserved base of mid-market demand, Elme Communities is building long-term value for shareholders.