Two Harbors Investments (NYSE:TWO – Get Free Report) and Claros Mortgage Trust (NYSE:CMTG – Get Free Report) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, profitability, institutional ownership, dividends, valuation and risk.
Insider & Institutional Ownership
64.2% of Two Harbors Investments shares are owned by institutional investors. Comparatively, 89.5% of Claros Mortgage Trust shares are owned by institutional investors. 0.6% of Two Harbors Investments shares are owned by insiders. Comparatively, 2.6% of Claros Mortgage Trust 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.
Analyst Ratings
This is a breakdown of recent ratings for Two Harbors Investments and Claros Mortgage Trust, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Two Harbors Investments | 2 | 4 | 0 | 1 | 2.00 |
| Claros Mortgage Trust | 3 | 1 | 0 | 0 | 1.25 |
Profitability
This table compares Two Harbors Investments and Claros Mortgage Trust’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Two Harbors Investments | -6.09% | 12.79% | 1.44% |
| Claros Mortgage Trust | -354.13% | -19.70% | -6.52% |
Volatility & Risk
Two Harbors Investments has a beta of 1.04, indicating that its stock price is 4% more volatile than the S&P 500. Comparatively, Claros Mortgage Trust has a beta of 1.16, indicating that its stock price is 16% more volatile than the S&P 500.
Valuation and Earnings
This table compares Two Harbors Investments and Claros Mortgage Trust”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Two Harbors Investments | $412.00 million | 3.08 | -$454.30 million | ($0.74) | -16.29 |
| Claros Mortgage Trust | $187.83 million | 1.34 | -$489.07 million | ($3.83) | -0.47 |
Two Harbors Investments has higher revenue and earnings than Claros Mortgage Trust. Two Harbors Investments is trading at a lower price-to-earnings ratio than Claros Mortgage Trust, indicating that it is currently the more affordable of the two stocks.
Summary
Two Harbors Investments beats Claros Mortgage Trust on 9 of the 14 factors compared between the two stocks.
About Two Harbors Investments
Two Harbors Investment Corp. invests in, finances, and manages mortgage servicing rights (MSRs), agency residential mortgage-backed securities (RMBS), and other financial assets through RoundPoint in the United States. The company target assets include agency RMBS collateralized by fixed rate mortgage loans, adjustable rate mortgage loans, hybrid mortgage loans, or derivatives; and other assets, such as financial and mortgage-related assets, including non-agency securities and non-hedging transactions. It qualifies as a REIT for federal income tax purposes. As a REIT, the company must distribute at least 90% of annual taxable income to its stockholders. Two Harbors Investment Corp. was incorporated in 2009 and is headquartered in St. Louis Park, Minnesota.
About Claros Mortgage Trust
Claros Mortgage Trust, Inc. operates as a real estate investment trust. It focuses on originating senior and subordinate loans on transitional commercial real estate assets in the United States. 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 incorporated in 2015 and is headquartered in New York, New York.
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