Head to Head Contrast: Ready Capital (NYSE:RC) & First Industrial Realty Trust (NYSE:FR)

Ready Capital (NYSE:RC) and First Industrial Realty Trust (NYSE:FR) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, analyst recommendations, risk, earnings and profitability.

Profitability

This table compares Ready Capital and First Industrial Realty Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ready Capital	-5.67%	7.32%	1.46%
First Industrial Realty Trust	44.46%	10.72%	5.48%

Dividends

Ready Capital pays an annual dividend of $1.20 per share and has a dividend yield of 14.2%. First Industrial Realty Trust pays an annual dividend of $1.48 per share and has a dividend yield of 2.6%. Ready Capital pays out 74.5% of its earnings in the form of a dividend. First Industrial Realty Trust pays out 68.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. First Industrial Realty Trust has increased its dividend for 11 consecutive years.

Analyst Recommendations

This is a summary of recent ratings for Ready Capital and First Industrial Realty Trust, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ready Capital	1	5	1	0	2.00
First Industrial Realty Trust	2	5	7	0	2.36

Ready Capital presently has a consensus target price of $9.65, suggesting a potential upside of 14.34%. First Industrial Realty Trust has a consensus target price of $55.50, suggesting a potential downside of 1.61%. Given Ready Capital’s higher probable upside, research analysts plainly believe Ready Capital is more favorable than First Industrial Realty Trust.

Institutional & Insider Ownership

55.9% of Ready Capital shares are owned by institutional investors. Comparatively, 99.8% of First Industrial Realty Trust shares are owned by institutional investors. 1.1% of Ready Capital shares are owned by insiders. Comparatively, 0.9% of First Industrial Realty Trust shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Volatility and Risk

Ready Capital has a beta of 1.43, meaning that its stock price is 43% more volatile than the S&P 500. Comparatively, First Industrial Realty Trust has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500.

Valuation and Earnings

This table compares Ready Capital and First Industrial Realty Trust’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ready Capital	$121.36 million	11.69	$339.45 million	$1.61	5.24
First Industrial Realty Trust	$638.79 million	11.69	$274.82 million	$2.17	26.00

Ready Capital has higher earnings, but lower revenue than First Industrial Realty Trust. Ready Capital is trading at a lower price-to-earnings ratio than First Industrial Realty Trust, indicating that it is currently the more affordable of the two stocks.

Summary

First Industrial Realty Trust beats Ready Capital on 11 of the 17 factors compared between the two stocks.

About Ready Capital

Ready Capital Corporation operates as a real estate finance company in the United States. It operates through two segments: LMM Commercial Real Estate and Small Business Lending. The company originates, acquires, finances, and services lower-to-middle-market (LLM) commercial real estate loans, small business administration (SBA) loans, residential mortgage loans, construction loans, and mortgage-backed securities collateralized primarily by LLM loans, or other real estate-related investments. The LMM Commercial Real Estate segment originates LLM loans across the full life-cycle of an LLM property, including construction, bridge, stabilized, and agency loan origination channels. The Small Business Lending segment acquires, originates, and services owner-occupied loans guaranteed by the SBA under its SBA Section 7(a) Program; and acquires purchased future receivables. The company has elected to be taxed as a real estate investment trust (REIT) and 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 Sutherland Asset Management Corporation and changed its name to Ready Capital Corporation in September 2018. Ready Capital Corporation was founded in 2007 and is headquartered in New York, New York.

About First Industrial Realty Trust

First Industrial Realty Trust, Inc. (NYSE: FR) is a leading U.S.-only owner, operator, developer and acquirer of logistics properties. Through our fully integrated operating and investing platform, we provide high quality facilities and industry-leading customer service to multinational corporations and regional firms that are essential for their supply chains. Our portfolio and new investments are concentrated in 15 target MSAs with an emphasis on supply-constrained, coastally oriented markets. In total, we own and have under development approximately 68.5 million square feet of industrial space as of December 31, 2023.