RAIT Financial Trust (NYSE: RAS) is one of 85 public companies in the “Commercial REITs” industry, but how does it compare to its rivals? We will compare RAIT Financial Trust to related companies based on the strength of its risk, earnings, profitability, institutional ownership, analyst recommendations, valuation and dividends.

Institutional and Insider Ownership

59.9% of RAIT Financial Trust shares are held by institutional investors. Comparatively, 68.7% of shares of all “Commercial REITs” companies are held by institutional investors. 1.3% of RAIT Financial Trust shares are held by insiders. Comparatively, 8.3% of shares of all “Commercial REITs” companies 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.

Risk and Volatility

RAIT Financial Trust has a beta of 1.63, meaning that its stock price is 63% more volatile than the S&P 500. Comparatively, RAIT Financial Trust’s rivals have a beta of 0.81, meaning that their average stock price is 19% less volatile than the S&P 500.

Valuation & Earnings

This table compares RAIT Financial Trust and its rivals gross revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
RAIT Financial Trust $58.82 million N/A -0.44
RAIT Financial Trust Competitors $482.34 million $305.34 million 32.26

RAIT Financial Trust’s rivals have higher revenue and earnings than RAIT Financial Trust. RAIT Financial Trust is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for RAIT Financial Trust and its rivals, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
RAIT Financial Trust 1 2 0 0 1.67
RAIT Financial Trust Competitors 626 2462 2125 22 2.29

RAIT Financial Trust presently has a consensus target price of $1.43, indicating a potential upside of 109.40%. As a group, “Commercial REITs” companies have a potential upside of 6.16%. Given RAIT Financial Trust’s higher possible upside, research analysts plainly believe RAIT Financial Trust is more favorable than its rivals.

Dividends

RAIT Financial Trust pays an annual dividend of $0.20 per share and has a dividend yield of 29.4%. RAIT Financial Trust pays out -13.0% of its earnings in the form of a dividend. As a group, “Commercial REITs” companies pay a dividend yield of 4.0% and pay out 205.1% of their earnings in the form of a dividend. RAIT Financial Trust is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Profitability

This table compares RAIT Financial Trust and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
RAIT Financial Trust -99.46% 0.98% 0.15%
RAIT Financial Trust Competitors 50.87% 6.60% 3.77%

Summary

RAIT Financial Trust rivals beat RAIT Financial Trust on 9 of the 13 factors compared.

About RAIT Financial Trust

RAIT Financial Trust (RAIT) is a real estate investment trust (REIT). The Company focuses on providing commercial real estate (CRE) financing throughout the United States. The core of its business is a full service CRE lending platform focused on first lien loans. It offers customized lending solutions to meet borrower needs and internal credit goals. It offers personalized middle-market financing solutions and a complement of lending products for CRE. The Company may also offer mezzanine loans and preferred equity interests in limited circumstances to support first lien loans. It is engaged in floating rate securitization programs and has access to multiple sources of funding, including senior debt, convertible securities, preferred securities and common securities. The Company also owns and manages a portfolio of CRE properties, and manages real estate assets for third parties. The Company is engaged in lending, owning and managing CRE assets throughout the United States.

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