Contrasting Elme Communities (NYSE:ELME) and Trinity Capital (NASDAQ:TRIN)
by Mitch Edgeman · The Markets DailyTrinity Capital (NASDAQ:TRIN – Get Free Report) and Elme Communities (NYSE:ELME – Get Free Report) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, earnings, analyst recommendations, risk, profitability and valuation.
Institutional and Insider Ownership
24.6% of Trinity Capital shares are owned by institutional investors. Comparatively, 87.9% of Elme Communities shares are owned by institutional investors. 4.3% of Trinity Capital shares are owned by company insiders. Comparatively, 1.4% of Elme Communities shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Analyst Ratings
This is a breakdown of current ratings and target prices for Trinity Capital and Elme Communities, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Trinity Capital | 1 | 1 | 4 | 1 | 2.71 |
| Elme Communities | 1 | 2 | 0 | 0 | 1.67 |
Trinity Capital presently has a consensus price target of $16.67, suggesting a potential downside of 5.17%. Elme Communities has a consensus price target of $18.00, suggesting a potential upside of 925.64%. Given Elme Communities’ higher possible upside, analysts clearly believe Elme Communities is more favorable than Trinity Capital.
Valuation and Earnings
This table compares Trinity Capital and Elme Communities”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Trinity Capital | $216.31 million | 7.69 | $135.60 million | $1.75 | 10.04 |
| Elme Communities | $206.36 million | 0.76 | -$154.16 million | ($1.52) | -1.15 |
Trinity Capital has higher revenue and earnings than Elme Communities. Elme Communities is trading at a lower price-to-earnings ratio than Trinity Capital, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Trinity Capital has a beta of 0.63, indicating that its stock price is 37% less volatile than the S&P 500. Comparatively, Elme Communities has a beta of 0.73, indicating that its stock price is 27% less volatile than the S&P 500.
Profitability
This table compares Trinity Capital and Elme Communities’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Trinity Capital | 43.45% | 14.94% | 6.69% |
| Elme Communities | N/A | N/A | N/A |
Summary
Trinity Capital beats Elme Communities on 12 of the 15 factors compared between the two stocks.
About Trinity Capital
Trinity Capital Inc. is a business development company. It is a venture capital firm specializing in venture debt to growth stage companies looking for loans and/or equipment financing. Trinity Capital Inc. was founded in 2019 is based in Phoenix, Arizona with additional offices in the United States.
About Elme Communities
Elme Communities is committed to elevating what home can be for middle-income renters by providing a higher level of quality, service, and experience. The Company is a multifamily real estate investment trust that owns and operates approximately 9,400 apartment homes in the Washington, DC metro and the Atlanta metro regions, and owns approximately 300,000 square feet of commercial space. Focused on providing quality, affordable homes to a deep, solid, and underserved base of mid-market demand, Elme Communities is building long-term value for shareholders.