Critical Review: New York Mortgage Trust (NASDAQ:NYMTL) & PennyMac Mortgage Investment Trust (NYSE:PMT)

PennyMac Mortgage Investment Trust (NYSE:PMT) and New York Mortgage Trust (NASDAQ:NYMTL) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, valuation, dividends, analyst recommendations, institutional ownership and profitability.

Earnings & Valuation

This table compares PennyMac Mortgage Investment Trust and New York Mortgage Trust”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PennyMac Mortgage Investment Trust	$307.46 million	2.65	$127.87 million	$1.42	6.59
New York Mortgage Trust	$273.96 million	N/A	N/A	N/A	N/A

PennyMac Mortgage Investment Trust has higher revenue and earnings than New York Mortgage Trust.

Dividends

PennyMac Mortgage Investment Trust pays an annual dividend of $1.60 per share and has a dividend yield of 17.1%. New York Mortgage Trust pays an annual dividend of $1.72 per share and has a dividend yield of 6.9%. PennyMac Mortgage Investment Trust pays out 112.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares PennyMac Mortgage Investment Trust and New York Mortgage Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PennyMac Mortgage Investment Trust	47.79%	12.50%	0.76%
New York Mortgage Trust	N/A	N/A	N/A

Analyst Ratings

This is a breakdown of current ratings and recommmendations for PennyMac Mortgage Investment Trust and New York Mortgage Trust, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PennyMac Mortgage Investment Trust	2	4	3	0	2.11
New York Mortgage Trust	0	0	0	0	0.00

PennyMac Mortgage Investment Trust currently has a consensus price target of $11.50, suggesting a potential upside of 22.86%. Given PennyMac Mortgage Investment Trust’s stronger consensus rating and higher probable upside, equities research analysts clearly believe PennyMac Mortgage Investment Trust is more favorable than New York Mortgage Trust.

Institutional and Insider Ownership

67.4% of PennyMac Mortgage Investment Trust shares are owned by institutional investors. 1.0% of PennyMac Mortgage Investment Trust shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

PennyMac Mortgage Investment Trust beats New York Mortgage Trust on 10 of the 11 factors compared between the two stocks.

About PennyMac Mortgage Investment Trust

PennyMac Mortgage Investment Trust, through its subsidiary, primarily invests in mortgage-related assets in the United States. The company operates through: Credit Sensitive Strategies, Interest Rate Sensitive Strategies, Correspondent Production segments. Its Credit Sensitive Strategies segment invests in credit risk transfer (CRT) agreements, CRT securities, subordinate mortgage-backed securities (MBS), distressed loans, and real estate. The company's Interest Rate Sensitive Strategies segment engages in investing in mortgage servicing rights, excess servicing spreads, and agency and senior non-agency MBS, as well as related interest rate hedging activities. Its Correspondent Production segment is involved in purchasing, pooling, and reselling newly originated prime credit residential loans directly or in the form of MBS. The company primarily sells its loans to government-sponsored entities or PennyMac Loan Services, LLC. 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 shareholders. The company was incorporated in 2009 and is headquartered in Westlake Village, California.

About New York Mortgage Trust

New York Mortgage Trust, Inc. acquires, invests in, finances, and manages mortgage-related single-family and multi-family residential assets in the United States. Its targeted investments include residential loans, including business purpose loans; structured multi-family property investments, such as preferred equity in, and mezzanine loans to owners of multi-family properties; non-agency residential mortgage-backed securities (RMBS); agency RMBS; commercial mortgage-backed securities (CMBS); single-family rental properties; and other mortgage, residential housing, and credit-related assets. The company also 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. New York Mortgage Trust, Inc. was incorporated in 2003 and is headquartered in New York, New York.