Top 15 Small-Cap Real Estate Stocks Ranked by Marvin Scores
Marvin's rules picked 15 small-cap Real Estate stocks. Ellington Financial, Newmark and Postal Realty Trust score highest against industry peers, and most picks are REITs of different types.
Small-cap real estate stocks are smaller property-related companies. Most on this list are real estate investment trusts (REITs), which own buildings or mortgages and pass income to shareholders. The list covers mortgage, office, retail, residential, healthcare and diversified REITs, plus a services firm and a land developer.
Marvin's rules chose these 15 stocks and ranked them by Overall score. Each score compares a company only with others in its own industry, so a high score in one industry is not directly comparable with a high score in another.
Keep in mind that mortgage REITs and property-owning REITs earn money in very different ways. Some figures, such as debt or margins, are missing for certain companies. A strong score is a starting point for your own research, not a conclusion.
The list
How Marvin ranked these stocks
Marvin included companies above a minimum size threshold and under a small-cap size ceiling in the Real Estate sector. They are ranked with the highest Overall score first, and only a limited number of stocks from any one industry are allowed. Scores run from zero to one hundred and are measured relative to each company's own industry, so they show how a company compares with its direct peers today, not how it compares with the whole market.
Companies above about $300 million in size, ranked by Marvin scores (0-100, relative to each company's own industry). The Real Estate sector, highest Overall score first, among companies under about $2 billion in size; at most 4 per industry.
The stocks, one by one
Ellington Financial Inc. EFC
Ellington Financial, a mortgage REIT, tops the list with an overall score of 96. Revenue grew 10.1% last year and operating margin was 37.2%, a healthy profit cushion. Return on equity of 9.9% is modest, and debt data is unavailable, so its borrowing level cannot be judged here.
Newmark Group, Inc. NMRK
Newmark, a real estate services firm, scores 94 overall. Revenue growth of 20.3% is strong, and free cash flow margin is 22.1%. Debt-to-equity of 0.94 looks moderate. The caution is a thin operating margin of 7.7%, which leaves little room if costs rise.
Postal Realty Trust, Inc. PSTL
Postal Realty Trust, an office REIT, has an overall score of 94. Revenue grew 25.5% and operating margin reached 37.8%, both solid. The caution is return on equity of only 5.2%, and debt-to-equity of 1.15 shows it leans on borrowed money.
MFA Financial, Inc. MFA
MFA Financial, a mortgage REIT, has an overall score of 93, with a quality score of 77 and an opportunity score of 95. Return on equity is 8.3%, a moderate level. The caution: growth, margin and debt figures are missing, so the picture is incomplete.
CTO Realty Growth, Inc. CTO
CTO Realty Growth, a diversified REIT, scores 91 overall. Revenue grew 20.1%, and gross margin of 74.7% and operating margin of 23.5% look healthy. The caution is a low return on equity of 2.4%, with debt-to-equity at 1.13.
Angel Oak Mortgage REIT, Inc. 9 AOMN
Angel Oak Mortgage REIT scores 90 overall, with a quality score of 89 and an opportunity score of 82. Quality is notably stronger than opportunity. The caution is that no growth, margin, return or debt figures are available, so these scores cannot be checked against underlying financials.
Getty Realty Corp. GTY
Getty Realty, a retail REIT, scores 85 overall. Its operating margin of 63.8% is very high, and revenue grew 9.0%. Debt-to-equity is 0.96, and return on equity is 8.9%. The caution is that growth is steady rather than fast, and return on equity is only moderate.
PennyMac Mortgage Investment Trust PMT
PennyMac Mortgage Investment Trust has an overall score of 85, helped by an opportunity score of 92. Its quality score is lower at 65. The caution is that revenue changed by -8.0% last year, a decline, and margin, return and debt figures are unavailable.
Easterly Government Properties, Inc. DEA
Easterly Government Properties, an office REIT, has a quality score of 94 but an opportunity score of just 52. Revenue grew 11.3% and gross margin is 77.3%. The caution is a very low return on equity of 0.8%, with debt-to-equity at 1.30.
Five Point Holdings, LLC FPH
Five Point Holdings, a real estate developer, has an overall score of 82, with a free cash flow margin of 55.8%. The cautions are large: revenue growth was -53.8%, a steep drop, return on equity is only 2.3%, and its opportunity score is just 45.
Centerspace CSR
Centerspace, a residential REIT, scores 78 overall, driven by an opportunity score of 94. Gross margin is 96.5% and operating margin is 26.0%. The caution is a weak quality score of 48, modest growth of 4.9%, and debt-to-equity of 1.45.
One Liberty Properties, Inc. OLP
One Liberty Properties, a diversified REIT, has an overall score of 75, with an opportunity score of 87 and a quality score of 66. Return on equity of 11.4% is respectable. The caution is that growth, margin and debt figures are missing.
Gladstone Commercial Corporation GOOD
Gladstone Commercial, a diversified REIT, scores 71 overall. Return on equity is 15.7% and revenue grew 8.0%. The caution is heavy borrowing: debt-to-equity of 5.46 is high compared with most others on this list, which adds risk.
Universal Health Realty Income Trust UHT
Universal Health Realty Income Trust, a healthcare REIT, scores 71 overall. Operating margin of 35.3% and return on equity of 13.4% are solid. The caution is that revenue growth of 0.2% was almost flat, and no debt figure is available.
CBL & Associates Properties, Inc. CBL
CBL & Associates, a retail REIT, has an overall score of 70, with a high opportunity score of 96. Revenue grew 12.2%. The cautions are a low quality score of 27 and debt-to-equity of 4.76. Its return on equity of 50.8% may partly reflect a small equity base.
Common questions
What does small-cap mean for real estate stocks?
Small-cap refers to companies with a smaller total market value than large, well-known firms. Smaller companies can have less trading activity and may react more sharply to news or changing conditions, so many investors look at them with extra care.
Why do mortgage REITs look different from other REITs here?
Mortgage REITs hold loans and mortgage securities rather than buildings, so measures like gross margin or free cash flow often do not apply or are missing. Property REITs own real estate and earn rent, so their margins and debt levels are easier to compare.
Does a high Marvin score mean a stock is a good investment?
No. Marvin's scores only describe how a company compares with other companies in its industry today. They do not predict future performance or say whether a stock fits your goals, so use them as one input alongside your own research.
Keep reading
- Top 15 Real Estate Stocks Marvin Rates Most Attractive Now
- Top 15 Real Estate Stocks Ranked by Marvin Scores
- Top 20 REIT Stocks by Marvin Score
- Top 15 Fastest-Growing Profitable Real Estate Companies
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Marvin's scores (0-100) compare each company with others in its industry today. Growth and margin figures come from SEC filings. This is general information, not personal investment advice or a recommendation to buy or sell anything. Do your own research.