Ellington Credit Company (EARN) vs ZeroStack Corp. (ZSTK)

Ellington Credit Company and ZeroStack Corp. are both Asset Management companies. Ellington Credit Company is the larger, with a market value of $127.1M against $92.1M — 1.4× the size. ZeroStack Corp. has negative trailing earnings, so its P/E is not meaningful; Ellington Credit Company trades at 11.5×. ZeroStack Corp. grew revenue faster over the last twelve months: 113.8% against 17.2%. Ellington Credit Company has the higher net margin (13.2% vs −444.2%) and the higher return on invested capital (1.60% vs −1,117.9%). Across the 18 metrics below, Ellington Credit Company leads on 10 and ZeroStack Corp. on 8.

Valuation

Metric EARN ZSTK Asset Management median
P/E 11.53 n/m 13.99
P/S 1.64 1.04 2.76
P/B 0.42 3.01 0.85
Price to free cash flow 10.32 n/m 8.32
EV/EBITDA — — —
EV/Sales — — —
Earnings yield 8.67% (1,051.18%) 4.72%
Free cash flow yield 9.69% (13.79%) 4.44%

Profitability

Metric EARN ZSTK Asset Management median
Gross margin 94.17% 13.14% 100.00%
Operating margin 12.60% (592.73%) 33.42%
Net margin 13.21% (444.23%) 13.37%
Free cash flow margin 15.86% (13.99%) 12.36%
Return on equity 3.99% (1,993.58%) 4.79%
Return on assets 0.00% (743.25%) 1.55%
Return on invested capital 1.60% (1,117.92%) 2.97%

Growth

Metric EARN ZSTK Asset Management median
Revenue growth (TTM) 17.19% 113.78% 7.42%
EPS growth (last fiscal year) (8.87%) 14.36% (6.67%)
Revenue growth, 5-year CAGR 2.61% 220.19% 12.51%
Net income growth, 5-year CAGR (21.61%) 0.00% 0.00%

Health

Metric EARN ZSTK Asset Management median
Debt to equity 2.91 0.17 0.44
Current ratio 0.14 0.95 1.30
Net debt to EBITDA 50.05 (0.31) 1.02

Dividend

Metric EARN ZSTK Asset Management median
Dividend yield 30.06% — 6.60%
Payout ratio — — 0.94

Size

Metric EARN ZSTK Asset Management median
Market cap 127.11m 92.08m 694.86m

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