Head to Head Analysis: The GEO Group (GEO) vs. Anworth Mortgage Asset (ANH)
The GEO Group (NYSE: GEO) and Anworth Mortgage Asset (NYSE:ANH) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, analyst recommendations, institutional ownership, dividends, profitability, earnings and risk.
The GEO Group pays an annual dividend of $1.88 per share and has a dividend yield of 8.0%. Anworth Mortgage Asset pays an annual dividend of $0.60 per share and has a dividend yield of 10.9%. The GEO Group pays out 139.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Anworth Mortgage Asset pays out 127.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. The GEO Group has increased its dividend for 2 consecutive years and Anworth Mortgage Asset has increased its dividend for 4 consecutive years. Anworth Mortgage Asset is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares The GEO Group and Anworth Mortgage Asset’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|The GEO Group||$2.18 billion||1.34||$148.71 million||$1.35||17.39|
|Anworth Mortgage Asset||$52.04 million||10.39||$22.49 million||$0.47||11.72|
The GEO Group has higher revenue and earnings than Anworth Mortgage Asset. Anworth Mortgage Asset is trading at a lower price-to-earnings ratio than The GEO Group, indicating that it is currently the more affordable of the two stocks.
This table compares The GEO Group and Anworth Mortgage Asset’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|The GEO Group||7.05%||14.85%||4.17%|
|Anworth Mortgage Asset||37.57%||8.84%||0.95%|
This is a summary of current ratings and recommmendations for The GEO Group and Anworth Mortgage Asset, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|The GEO Group||0||1||2||0||2.67|
|Anworth Mortgage Asset||0||1||0||0||2.00|
The GEO Group currently has a consensus target price of $33.78, suggesting a potential upside of 43.85%. Anworth Mortgage Asset has a consensus target price of $6.00, suggesting a potential upside of 8.89%. Given The GEO Group’s stronger consensus rating and higher possible upside, equities analysts clearly believe The GEO Group is more favorable than Anworth Mortgage Asset.
Volatility and Risk
The GEO Group has a beta of 1.52, indicating that its share price is 52% more volatile than the S&P 500. Comparatively, Anworth Mortgage Asset has a beta of 0.19, indicating that its share price is 81% less volatile than the S&P 500.
Insider and Institutional Ownership
95.6% of The GEO Group shares are owned by institutional investors. Comparatively, 56.3% of Anworth Mortgage Asset shares are owned by institutional investors. 2.4% of The GEO Group shares are owned by company insiders. Comparatively, 1.9% of Anworth Mortgage Asset shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
The GEO Group beats Anworth Mortgage Asset on 11 of the 17 factors compared between the two stocks.
About The GEO Group
The GEO Group, Inc. is a real estate investment trust (REIT) specializing in the ownership, leasing and management of correctional, detention and re-entry facilities and the provision of community-based services and youth services in the United States, Australia, South Africa, the United Kingdom and Canada. As of December 31, 2013, its worldwide operations included the management and/or ownership of approximately 77,000 beds at 98 correctional, detention and community based facilities, including idle faclities and projects under development, and also included the provision of monitoring of more than 70,000 offenders in a community-based environment on behalf of approximately 900 federal, state and local correctional agencies located in all 50 states. The Company operates in four segments: United States Corrections and Detention segment, segment; International Services segment and Facility Construction and Design segment.
About Anworth Mortgage Asset
Anworth Mortgage Asset Corporation is a real estate investment trust (REIT). The Company’s investment objective is to provide risk-adjusted total returns to its stockholders over the long-term primarily through dividends and secondarily through capital appreciation. Its strategy is to invest in residential mortgage-backed securities (MBS) (both Agency MBS and Non-Agency MBS), residential mortgage loans and residential rental properties. Its principal business objective is to generate net income for distribution to its stockholders primarily based upon the spread between the interest income on its mortgage assets and its borrowing costs to finance its acquisition of those assets. The Company finances residential mortgage loans through asset-backed securities, which are issued by the consolidated securitization trusts. The Company is engaged in investing in, financing and managing a portfolio of residential mortgage-backed securities and residential mortgage loans.
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