Paramount Group (NYSE:PGRE – Get Free Report) and Chicago Atlantic Real Estate Finance (NASDAQ:REFI – Get Free Report) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their risk, profitability, earnings, institutional ownership, analyst recommendations, valuation and dividends.
Profitability
This table compares Paramount Group and Chicago Atlantic Real Estate Finance’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Paramount Group | -27.96% | -5.15% | -2.64% |
| Chicago Atlantic Real Estate Finance | 63.27% | 13.29% | 10.10% |
Insider and Institutional Ownership
65.6% of Paramount Group shares are owned by institutional investors. Comparatively, 25.5% of Chicago Atlantic Real Estate Finance shares are owned by institutional investors. 13.5% of Paramount Group shares are owned by insiders. Comparatively, 12.3% of Chicago Atlantic Real Estate Finance shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Volatility & Risk
Analyst Ratings
This is a breakdown of recent ratings and target prices for Paramount Group and Chicago Atlantic Real Estate Finance, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Paramount Group | 2 | 2 | 1 | 0 | 1.80 |
| Chicago Atlantic Real Estate Finance | 0 | 0 | 1 | 1 | 3.50 |
Paramount Group currently has a consensus target price of $4.70, indicating a potential downside of 6.93%. Chicago Atlantic Real Estate Finance has a consensus target price of $20.00, indicating a potential upside of 25.71%. Given Chicago Atlantic Real Estate Finance’s stronger consensus rating and higher possible upside, analysts plainly believe Chicago Atlantic Real Estate Finance is more favorable than Paramount Group.
Valuation and Earnings
This table compares Paramount Group and Chicago Atlantic Real Estate Finance”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Paramount Group | $742.79 million | 1.48 | -$259.74 million | ($1.16) | -4.35 |
| Chicago Atlantic Real Estate Finance | $57.15 million | 5.46 | $38.71 million | $1.99 | 7.99 |
Chicago Atlantic Real Estate Finance has lower revenue, but higher earnings than Paramount Group. Paramount Group is trading at a lower price-to-earnings ratio than Chicago Atlantic Real Estate Finance, indicating that it is currently the more affordable of the two stocks.
Dividends
Paramount Group pays an annual dividend of $0.14 per share and has a dividend yield of 2.8%. Chicago Atlantic Real Estate Finance pays an annual dividend of $1.88 per share and has a dividend yield of 11.8%. Paramount Group pays out -12.1% of its earnings in the form of a dividend. Chicago Atlantic Real Estate Finance pays out 94.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Summary
Chicago Atlantic Real Estate Finance beats Paramount Group on 11 of the 16 factors compared between the two stocks.
About Paramount Group
Paramount Group, Inc. ("Paramount" or the "Company") is a fully-integrated real estate investment trust that owns, operates, manages, acquires and redevelops high-quality, Class A office properties located in select central business district submarkets of New York and San Francisco. Paramount is focused on maximizing the value of its portfolio by leveraging the sought-after locations of its assets and its proven property management capabilities to attract and retain high-quality tenants.
About Chicago Atlantic Real Estate Finance
Chicago Atlantic Real Estate Finance, Inc. operates as a commercial real estate finance company in the United States. The company engages in originating, structuring, and investing in first mortgage loans and alternative structured financings secured by commercial real estate properties. Its portfolio primarily includes offers senior loans to state-licensed operators in the cannabis industry. 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. Chicago Atlantic Real Estate Finance, Inc. was incorporated in 2021 and is headquartered in Chicago, Illinois.
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