Great Ajax Disappoints with Earnings Miss, Cuts Dividend

Great Ajax: Earnings Beat and Dividend Cut

Is Great Ajax a Buy After Earnings Miss?

B. Riley analyst M. Howlett is bullish on Great Ajax, assigning a "Buy" rating and a $6.00 price objective despite the company's earnings miss in Q1 2024. The analyst estimates EPS of ($0.07) for the quarter, below the consensus estimate of $0.02. Howlett also forecasts earnings of ($0.01) EPS for Q2 2024, $0.03 EPS for Q3 2024, $0.08 EPS for Q4 2024, $0.02 EPS for FY2024, $0.09 EPS for Q1 2025, $0.10 EPS for Q2 2025, $0.12 EPS for Q3 2025, $0.15 EPS for Q4 2025, and $0.45 EPS for FY2025.

Great Ajax's Recent Financial Performance

Great Ajax recently reported its quarterly earnings data, with EPS of ($0.07) for the quarter, missing analysts' estimates by ($0.28). Revenue for the quarter was $17.66 million, below expectations of $5.65 million. The company also cut its quarterly dividend to $0.10 per share, representing an annualized dividend of $0.40 and a yield of 10.78%.

Analyst Sentiment on Great Ajax

JMP Securities downgraded Great Ajax from an "outperform" to a "market perform" rating in January, while StockNews.com upgraded the stock from a "sell" to a "hold" rating in March. The company has a consensus rating of "Hold" among analysts.

Technical Analysis of Great Ajax

Great Ajax's stock price has been trending lower, opening at $3.71 on Monday with a market capitalization of $101.88 million. The stock has a 50-day moving average price of $4.66 and a 200-day moving average price of $5.15. The company has a 1-year low of $3.30 and a 1-year high of $7.20.

Institutional Ownership of Great Ajax

Institutional investors have recently increased their stakes in Great Ajax. Raymond James & Associates increased its holdings by 38.0%, Healthcare of Ontario Pension Plan Trust Fund acquired a new stake, MetLife Investment Management LLC increased its holdings by 54.3%, Charles Schwab Investment Management Inc. increased its holdings by 2.7%, and Renaissance Technologies LLC increased its holdings by 5.1%. Hedge funds and other institutional investors own 58.60% of the company's stock.

Great Ajax's Business Overview

Great Ajax Corp. is a mortgage real estate investment trust that acquires re-performing and non-performing loans, originates small balance commercial mortgage loans secured by multi-family residential and commercial mixed-use retail/residential properties, and invests in single-family and smaller commercial properties.

Conclusion

Despite missing analysts' earnings estimates in Q1 2024, B. Riley remains bullish on Great Ajax, assigning a "Buy" rating and a $6.00 price objective. The company's recent dividend cut and weak technical analysis may be concerns for investors, but the increased institutional ownership and Howlett's positive outlook could provide some support for the stock. Investors should carefully consider the risks and potential rewards before making any investment decisions.