Comparing Orchid Island Capital (NYSE:ORC) and Wheeler Real Estate Investment Trust (NASDAQ:WHLR)

Wheeler Real Estate Investment Trust (NASDAQ:WHLR) and Orchid Island Capital (NYSE:ORC) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, dividends, risk and institutional ownership.

Earnings and Valuation

This table compares Wheeler Real Estate Investment Trust and Orchid Island Capital”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Wheeler Real Estate Investment Trust	$103.20 million	0.03	-$4.69 million	($1,554.97)	0.00
Orchid Island Capital	$54.41 million	15.16	$37.78 million	$0.60	14.73

Orchid Island Capital has lower revenue, but higher earnings than Wheeler Real Estate Investment Trust. Wheeler Real Estate Investment Trust is trading at a lower price-to-earnings ratio than Orchid Island Capital, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

35.3% of Wheeler Real Estate Investment Trust shares are owned by institutional investors. Comparatively, 32.7% of Orchid Island Capital shares are owned by institutional investors. 40.6% of Wheeler Real Estate Investment Trust shares are owned by insiders. Comparatively, 0.6% of Orchid Island Capital shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Wheeler Real Estate Investment Trust and Orchid Island Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Wheeler Real Estate Investment Trust	-29.69%	N/A	-4.57%
Orchid Island Capital	N/A	-2.01%	-0.23%

Volatility & Risk

Wheeler Real Estate Investment Trust has a beta of 1.51, suggesting that its stock price is 51% more volatile than the S&P 500. Comparatively, Orchid Island Capital has a beta of 1.83, suggesting that its stock price is 83% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Wheeler Real Estate Investment Trust and Orchid Island Capital, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Wheeler Real Estate Investment Trust	0	0	0	0	0.00
Orchid Island Capital	0	1	1	0	2.50

Orchid Island Capital has a consensus price target of $9.50, suggesting a potential upside of 7.47%. Given Orchid Island Capital’s stronger consensus rating and higher probable upside, analysts plainly believe Orchid Island Capital is more favorable than Wheeler Real Estate Investment Trust.

Dividends

Wheeler Real Estate Investment Trust pays an annual dividend of $1.68 per share and has a dividend yield of 59.2%. Orchid Island Capital pays an annual dividend of $1.44 per share and has a dividend yield of 16.3%. Wheeler Real Estate Investment Trust pays out -0.1% of its earnings in the form of a dividend. Orchid Island Capital pays out 240.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Wheeler Real Estate Investment Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Orchid Island Capital beats Wheeler Real Estate Investment Trust on 10 of the 16 factors compared between the two stocks.

About Wheeler Real Estate Investment Trust

Headquartered in Virginia Beach, Virginia, Wheeler Real Estate Investment Trust, Inc. is a fully integrated, self-managed commercial real estate investment trust (REIT) focused on owning and operating income-producing retail properties with a primary focus on grocery-anchored centers.

About Orchid Island Capital

Orchid Island Capital, Inc., a specialty finance company, invests in residential mortgage-backed securities (RMBS) in the United States. The company’s RMBS is backed by single-family residential mortgage loans, referred as Agency RMBS. Its portfolio includes traditional pass-through Agency RMBS, such as mortgage pass through certificates and collateralized mortgage obligations; and structured Agency RMBS comprising interest only securities, inverse interest only securities, and principal only securities. The company has elected to be taxed as a real estate investment trust (REIT) for the United States federal income tax purposes. As a result, it would not be subject to corporate income tax on that portion of its net income that is distributed to stockholders, if it annually distributes dividends equal to at least 90% of its REIT taxable income to its stockholders. Orchid Island Capital, Inc. was incorporated in 2010 and is headquartered in Vero Beach, Florida.