Critical Analysis: Franklin BSP Realty Trust (NYSE:FBRT) vs. AGNC Investment (NASDAQ:AGNCL)

Franklin BSP Realty Trust (NYSE:FBRT) and AGNC Investment (NASDAQ:AGNCL) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, earnings, valuation, profitability, dividends, institutional ownership and analyst recommendations.

Profitability

This table compares Franklin BSP Realty Trust and AGNC Investment’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Franklin BSP Realty Trust	20.49%	5.82%	1.17%
AGNC Investment	N/A	N/A	N/A

Analyst Recommendations

This is a summary of recent ratings and price targets for Franklin BSP Realty Trust and AGNC Investment, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Franklin BSP Realty Trust	1	1	3	0	2.40
AGNC Investment	0	0	0	0	0.00

Franklin BSP Realty Trust currently has a consensus target price of $11.50, suggesting a potential upside of 35.17%. Given Franklin BSP Realty Trust’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Franklin BSP Realty Trust is more favorable than AGNC Investment.

Valuation & Earnings

This table compares Franklin BSP Realty Trust and AGNC Investment”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Franklin BSP Realty Trust	$270.07 million	2.62	$82.27 million	$0.44	19.34
AGNC Investment	$2.40 billion	N/A	N/A	N/A	N/A

Franklin BSP Realty Trust has higher earnings, but lower revenue than AGNC Investment.

Institutional & Insider Ownership

59.9% of Franklin BSP Realty Trust shares are held by institutional investors. 1.3% of Franklin BSP Realty Trust shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Franklin BSP Realty Trust pays an annual dividend of $0.80 per share and has a dividend yield of 9.4%. AGNC Investment pays an annual dividend of $1.94 per share and has a dividend yield of 7.6%. Franklin BSP Realty Trust pays out 181.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Franklin BSP Realty Trust beats AGNC Investment on 9 of the 11 factors compared between the two stocks.

About Franklin BSP Realty Trust

Benefit Street Partners operates as a self-managed real estate investment trust (REIT). BSP earns income from investing in a leveraged portfolio of residential mortgage pass-through securities consisting almost exclusively of adjustable-rate mortgage (ARM) securities issued and guaranteed by government-sponsored enterprises, either Federal National Mortgage Association (Fannie Mae) or Federal Home Loan Mortgage Corporation (Freddie Mac) (together, the government-sponsored enterprises (GSEs)), or by an agency of the federal government, Government National Mortgage Association (Ginnie Mae). BSP’s investment strategy focuses on managing a portfolio of residential mortgage investments consisting almost exclusively of ARM Agency Securities. As of December 31, 2012, the Company’s securities consisted of Agency Securities classified as available-for-sale and Residential mortgage securities classified as held-to-maturity.

About AGNC Investment

AGNC Investment Corp. provides private capital to housing market in the United States. It invests in residential mortgage pass-through securities and collateralized mortgage obligations for which the principal and interest payments are guaranteed by the United States government-sponsored enterprise or by the United States government agency. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was formerly known as American Capital Agency Corp. and changed its name to AGNC Investment Corp. in September 2016. AGNC Investment Corp. was incorporated in 2008 and is headquartered in Bethesda, Maryland.