Head-To-Head Contrast: Walker & Dunlop (NYSE:WD) vs. Acacia Research (NASDAQ:ACTG)

Walker & Dunlop (NYSE:WD) and Acacia Research (NASDAQ:ACTG) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, institutional ownership, profitability, analyst recommendations, risk, dividends and valuation.

Analyst Recommendations

This is a summary of current ratings for Walker & Dunlop and Acacia Research, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Walker & Dunlop	1	0	5	0	2.67
Acacia Research	1	0	1	0	2.00

Walker & Dunlop presently has a consensus target price of $64.00, suggesting a potential upside of 53.70%. Acacia Research has a consensus target price of $6.00, suggesting a potential upside of 34.23%. Given Walker & Dunlop’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Walker & Dunlop is more favorable than Acacia Research.

Volatility & Risk

Walker & Dunlop has a beta of 1.49, indicating that its stock price is 49% more volatile than the S&P 500. Comparatively, Acacia Research has a beta of 0.45, indicating that its stock price is 55% less volatile than the S&P 500.

Profitability

This table compares Walker & Dunlop and Acacia Research’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Walker & Dunlop	2.94%	7.25%	2.31%
Acacia Research	-5.39%	0.44%	0.33%

Earnings and Valuation

This table compares Walker & Dunlop and Acacia Research”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Walker & Dunlop	$1.23 billion	1.16	$57.08 million	$1.12	37.18
Acacia Research	$285.23 million	1.53	$21.68 million	($0.15)	-29.80

Walker & Dunlop has higher revenue and earnings than Acacia Research. Acacia Research is trading at a lower price-to-earnings ratio than Walker & Dunlop, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

81.0% of Walker & Dunlop shares are held by institutional investors. Comparatively, 86.7% of Acacia Research shares are held by institutional investors. 4.0% of Walker & Dunlop shares are held by insiders. Comparatively, 1.7% of Acacia Research shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Walker & Dunlop beats Acacia Research on 12 of the 14 factors compared between the two stocks.

About Walker & Dunlop

Walker & Dunlop, Inc. is a holding company, which engages in the provision of commercial real estate and finance services. It operates through the following segments: Capital Markets, Servicing and Asset Management, and Corporate. The Capital Markets segment offers a comprehensive range of commercial real estate finance products to customers. The Servicing and Asset Management segment includes servicing and asset-managing and managing third-party capital investments. The Corporate segment consists primarily of the company’s treasury operations and other corporate-level activities. The company was founded by Oliver Walker and Laird Dunlop in 1937 and is headquartered in Bethesda, MD.

About Acacia Research

Acacia is a publicly traded (Nasdaq: ACTG) company that is focused on acquiring and operating businesses across the industrial, energy and technology sectors where it believes it can leverage its expertise, significant capital base, and deep industry relationships to drive value. Acacia evaluates opportunities based on the attractiveness of the underlying cash flows, without regard to a specific investment horizon. Acacia operates its businesses based on three key principles of people, process, and performance and has built a management team with demonstrated expertise in research, transactions and execution, and operations and management.