ONEX (OTCMKTS:ONEXF) & Ellington Credit (NYSE:EARN) Head to Head Survey

ONEX (OTCMKTS:ONEXF) and Ellington Credit (NYSE:EARN) are both finance companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, dividends, risk, analyst recommendations, valuation and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings and price targets for ONEX and Ellington Credit, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ONEX	0	2	3	0	2.60
Ellington Credit	0	0	1	0	3.00

Ellington Credit has a consensus price target of $5.50, suggesting a potential upside of 64.92%. Given Ellington Credit’s stronger consensus rating and higher probable upside, analysts plainly believe Ellington Credit is more favorable than ONEX.

Volatility & Risk

ONEX has a beta of 1.25, indicating that its share price is 25% more volatile than the S&P 500. Comparatively, Ellington Credit has a beta of 1.32, indicating that its share price is 32% more volatile than the S&P 500.

Insider & Institutional Ownership

0.7% of ONEX shares are owned by institutional investors. Comparatively, 20.4% of Ellington Credit shares are owned by institutional investors. 1.4% of Ellington Credit shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares ONEX and Ellington Credit’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ONEX	63.83%	5.24%	4.21%
Ellington Credit	-70.52%	N/A	N/A

Valuation & Earnings

This table compares ONEX and Ellington Credit”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ONEX	$899.00 million	6.10	$617.00 million	$6.68	10.77
Ellington Credit	$15.88 million	8.02	-$38.85 million	($0.98)	-3.40

ONEX has higher revenue and earnings than Ellington Credit. Ellington Credit is trading at a lower price-to-earnings ratio than ONEX, indicating that it is currently the more affordable of the two stocks.

Dividends

ONEX pays an annual dividend of $0.28 per share and has a dividend yield of 0.4%. Ellington Credit pays an annual dividend of $0.96 per share and has a dividend yield of 28.8%. ONEX pays out 4.2% of its earnings in the form of a dividend. Ellington Credit pays out -98.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Ellington Credit is clearly the better dividend stock, given its higher yield and lower payout ratio.

About ONEX

Onex Corporation is a private equity firm specializing in acquisitions and platform acquisitions. The firm makes investments in buyouts, large- middle market, large-cap, mid-cap, and small-cap market and distressed companies. It also invests in recapitalization, growth capital, corporate carve-outs of subsidiaries and mission-critical supply divisions from multinational corporations, operational restructurings of undervalued businesses, and builds up. The firm seeks to invest in technology, electronics manufacturing services, industrial, aerospace, healthcare, retail, restaurants, industrials products, customer care services, metal services, building products, entertainment, gaming, cabinetry products, commercial vehicles, commercial and investment banking, financial services, commercial and multi-unit residential real estate. It invests in global businesses headquartered in North America, including United States and Canada, or Europe. The firm seeks to invest between $125 million and $1 billion in companies that have minimum revenues of $300 million. It does not consider size if the company is in an industry in which the firm already has presence. The firm seeks to make direct as well as co-investments through managed private equity, real estate and credit funds. It seeks to acquire a control position in its portfolio companies. Onex Corporation was founded in 1984 and is based in Toronto, Canada with additional offices in New York, New York; Englewood Cliffs, New Jersey; Boston, Massachusetts and London, United Kingdom.

About Ellington Credit

Ellington Credit Company, a real estate investment trust, acquires, invests in, and manages residential mortgage-and real estate-related assets. It acquires and manages residential mortgage-backed securities (RMBS), including agency pools and agency collateralized mortgage obligations (CMOs); and non-agency RMBS, such as non-agency CMOs, such as investment grade and non-investment grade. 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 formerly known as Ellington Residential Mortgage REIT and changed its name to Ellington Credit Company in April 2024. Ellington Credit Company was incorporated in 2012 and is based in Old Greenwich, Connecticut.