Ellington Financial Inc
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Financials : Mortgage Real Estate Investment Trusts (REITs) | Small Cap Value
Company profile

Ellington Financial Inc. is a real estate investment trust (REIT). The Company acquires and manages mortgage-related, consumer-related, corporate-related, and other financial assets. The Company invests in a range of financial assets, including residential mortgage loans, residential mortgage-backed securities (RMBS), commercial mortgage-backed securities (CMBS), consumer loans and asset-backed securities (ABS), collateralized loan obligations (CLOs), mortgage-related and non-mortgage-related derivatives, strategic investments, and other investments, including corporate debt and equity securities and corporate loans. Its investments in residential and commercial mortgage loans consist of performing, non-performing, or sub-performing loans. The Company acquires and manages other types of mortgage-related and financial assets, such as mortgage servicing rights (MSRs) and credit risk transfer securities (CRTs). Its subsidiaries include EF Mortgage LLC, EF Securities LLC and EF CMO LLC.

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It's a great time to scoop up bargain stocks. Here are 21 examples that could make you a lot of money.

6:13 am ET September 19, 2022 (MarketWatch)

By Philip van Doorn

Stocks of online advertisers have been crushed. But the group may roar back, benefiting committed investors

Are you a contrarian investor? Sometimes it seems everyone claims to be one, but it isn't easy, especially after a wipeout such as the one we saw on Sept. 13.

An investor who wishes to pay bargain prices to enjoy larger gains down the line needs the courage to jump in when other people are in panic mode.

Below is a list of companies in, or associated with, an industry that has taken it on the chin this year: online advertising.

Most of the companies in this group are expected to grow their revenues at a much faster pace than the broader market over the next two years.

Back to basics with Warren Buffett

Before looking at the online advertisers, it is a good idea to review the following, even if you believe you have heard it all before.

You have probably seen bits and pieces of the following from Berkshire Hathaway CEO Warren Buffett from his letter to shareholders summing up the conglomerate's results in 1986. Here's a longer version of it:

Common stocks, of course, are the most fun. When conditions are right, that is, when companies with good economics and good management sell well below intrinsic business value -- stocks sometimes provide grand-slam home runs.

Buffett then writes that Berkshire cannot predict stock-market performance.

What we do know, however, is that occasional outbreaks of those two super-contagious diseases, fear and greed, will forever occur in the investment community. The timing of these epidemics will be unpredictable. And the market aberrations produced by them will be equally unpredictable, both as to duration and degree. Therefore, we never try to anticipate the arrival or departure of either disease. Our goal is more modest: We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.

I bolded that last sentence. It is easy to suggest that people looking to bag outsized gains go against the grain when the market gives them the opportunity. It is far more difficult to have enough faith and patience to put the idea into practice.

As part of your own investment research, you should read Buffett's most recent letter to shareholders. All of his letters can help you. They are listed here.

The beaten-down online-advertising group

This idea resulted from a Twitter posting by Eric Jhonsa:

Jhonsa mentioned the semiconductor industry, whose stocks have been slammed this year as chip makers enter a downcycle, in the wake of pandemic-era shortages. Several of the largest manufacturers in the industry have had large recent cuts to their 12-month rolling consensus estimates for sales and earnings. Others have bucked the trend.

Jhonsa supplied a list of 21 stocks of online advertisers or companies that provide supporting software or services. These stocks have been hammered this year. For some, forward price-to-earnings ratios are now relatively low when considering how rapidly these companies are expected to grow. Analysts expect great things for the three stocks Jhonsa mentioned by ticker, as you can see below.

To look further ahead, here's Jhonsa's list, with consensus sales estimates for calendar 2022, 2023 and 2024 among analysts polled by FactSet. The 2024 sales estimates are available for all but two companies. The group is ranked by how much sales are expected to grow during 2023, based on the estimates:

Company                             Ticker  Expected sales growth -- 2023  Two-year estimated sales CAGR through 2024  Estimated sales -- 2022 ($mil.)  Estimated sales -- 2023 ($mil.)  Estimated sales -- 2024 ($mil.)  Market cap. ($mil.) 
Tremor International Ltd. ADR        TRMR                          28.7%                                         N/A                            $303                            $390                             N/A                 $562 
ironSource Ltd Class A                IS                           25.3%                                       23.4%                            $766                            $960                          $1,165               $2,716 
Trade Desk Inc. Class A              TTD                           24.9%                                       26.0%                          $1,592                          $1,989                          $2,526              $28,351 
Doximity Inc. Class A                DOCS                          24.7%                                       27.1%                            $408                            $509                            $659               $3,653 
DoubleVerify Holdings Inc.            DV                           24.6%                                       24.1%                            $449                            $560                            $692               $4,709 
Innovid Corp.                        CTV                           24.6%                                       19.7%                            $130                            $162                            $186                 $408 
AppLovin Corp. Class A               APP                           20.2%                                       17.8%                          $2,975                          $3,575                          $4,131               $7,789 
Inuvo Inc.                           INUV                          19.5%                                         N/A                             $89                            $106                             N/A                  $58 
PubMatic Inc. Class A                PUBM                          19.0%                                       21.2%                            $279                            $332                            $410                 $766 
Zeta Global Holdings Corp. Class A   ZETA                          18.4%                                       20.2%                            $563                            $667                            $815               $1,321 
Integral Ad Science Holding Corp.    IAS                           17.3%                                       19.8%                            $400                            $470                            $575               $1,265 
Roku Inc. Class A                    ROKU                          17.3%                                       21.6%                          $3,139                          $3,682                          $4,642               $8,216 
Perion Network Ltd.                  PERI                          16.2%                                       12.3%                            $629                            $731                            $794                 $966 
Snap Inc. Class A                    SNAP                          15.9%                                       18.6%                          $4,635                          $5,374                          $6,523              $16,416 
Digital Turbine Inc.                 APPS                          15.3%                                       23.1%                            $767                            $884                          $1,163               $1,791 
Pinterest Inc. Class A               PINS                          15.2%                                       17.7%                          $2,799                          $3,224                          $3,877              $14,333 
Magnite Inc.                         MGNI                          14.9%                                       17.6%                            $508                            $583                            $702                 $988 
Twitter Inc.                         TWTR                          14.1%                                       16.7%                          $5,287                          $6,034                          $7,205              $31,941 
Criteo SA ADR                        CRTO                          13.8%                                       10.3%                            $973                          $1,108                          $1,184               $1,716 
Alphabet Inc. Class A               GOOGL                          11.6%                                       11.9%                        $289,552                        $323,097                        $362,324             $625,503 
Meta Platforms Inc. Class A          META                          10.2%                                       11.9%                        $117,850                        $129,837                        $147,512             $349,239 
                                                                                                                                                                                                                          Source: FactSet 

Click on the tickers for more about each company, including corporate profiles, news, financials and stock performance. Click here for Tomi Kilgore's detailed guide to the wealth of information available for free on MarketWatch quote pages

We used calendar-year estimates for a uniform set of numbers, as many companies' fiscal years don't match the calendar.

For companies for which consensus sales estimates are available through 2024, the table includes expected two-year compound annual growth rates (CAGR).

In comparison, companies in the S&P 500 as a group are expected to increase sales by a weighted 4.2% in 2023, with a two-year sales CAGR of 4.5% through 2024.

There is quite a range of companies on the list, by size. On the low end, Inuvo Inc. (INUV) has a market capitalization of only $58 million and is a penny stock, having fallen to 48 cents a share on Sept. 13 from 53 cents at the end of 2021. Among analysts polled by FactSet, only two cover this stock. All others on the list are covered by at least five analysts.

2022-09-19 10:13:00 GMT MW It's a great time to scoop up bargain stocks. -2-

Here's the list again, this time with forward price-to-earnings ratios based on consensus 12-month earnings estimates and ratings summary, sorted by the 12-month upside potential implied by the price targets:

Company                             Ticker  Forward P/E  Share "buy" ratings  Share neutral ratings  Share "sell" ratings  Price -- Sept. 13  Cons. price target  Implied 12-month upside potential 
Inuvo Inc.                           INUV           N/A                 100%                     0%                    0%             $0.48               $1.38                               185% 
Tremor International Ltd. ADR        TRMR           5.4                 100%                     0%                    0%             $7.75              $20.30                               162% 
Magnite Inc.                         MGNI           9.1                  90%                    10%                    0%             $7.43              $14.75                                99% 
AppLovin Corp. Class A               APP           35.8                  94%                     0%                    6%            $26.68              $52.13                                95% 
Digital Turbine Inc.                 APPS          11.4                 100%                     0%                    0%            $18.12              $35.18                                94% 
Integral Ad Science Holding Corp.    IAS           34.2                  88%                    12%                    0%             $8.12              $14.25                                75% 
Innovid Corp.                        CTV            N/A                  75%                     0%                   25%             $3.08               $4.93                                60% 
Zeta Global Holdings Corp. Class A   ZETA          27.6                  80%                    20%                    0%             $7.71              $12.06                                56% 
PubMatic Inc. Class A                PUBM          20.6                  70%                    30%                    0%            $17.96              $27.28                                52% 
Perion Network Ltd.                  PERI          11.0                 100%                     0%                    0%            $21.75              $31.67                                46% 
Meta Platforms Inc. Class A          META          14.3                  72%                    26%                    2%           $153.13             $216.67                                41% 
Criteo SA ADR                        CRTO           9.3                  69%                    31%                    0%            $28.31              $39.58                                40% 
Alphabet Inc. Class A               GOOGL          18.0                  94%                     6%                    0%           $104.32             $141.79                                36% 
Doximity Inc. Class A                DOCS          44.4                  79%                    14%                    7%            $33.07              $41.92                                27% 
ironSource Ltd Class A                IS           22.3                  46%                    54%                    0%             $3.92               $4.92                                25% 
Trade Desk Inc. Class A              TTD           57.5                  73%                    27%                    0%            $63.85              $79.59                                25% 
Snap Inc. Class A                    SNAP           N/A                  29%                    64%                    7%            $11.77              $14.21                                21% 
Roku Inc. Class A                    ROKU           N/A                  52%                    29%                   19%            $68.05              $81.00                                19% 
DoubleVerify Holdings Inc.            DV           47.3                  79%                    21%                    0%            $28.71              $32.58                                13% 
Pinterest Inc. Class A               PINS          36.7                  30%                    67%                    3%            $24.59              $25.22                                 3% 
Twitter Inc.                         TWTR          55.3                   0%                    94%                    6%            $41.74              $41.51                                -1% 

Price-to-earnings ratios are marked "N/A" for the companies that aren't expected to show profits for the current 12-month period.

As with any list of stocks, the point here is to highlight a group of companies that may be worth a deeper look as you consider how to invest your money. You should do your own research to form your own opinion about any investment. For an individual company, consider how likely it is to remain successful and competitive for the next decade at least.

For the positive side of rising interest rates, don't miss: 20 bank stocks expected to benefit the most from rising interest rates as the Federal Reserve fights inflation

And for income: Preferred stocks can offer hidden opportunities for dividend investors. Just look at this JPMorgan Chase example

Hear from Ray Dalio at MarketWatch's Best New Ideas in Money Festival on Sept. 21 and 22 in New York. The hedge-fund pioneer has strong views on where the economy is headed.

-Philip van Doorn


(END) Dow Jones Newswires

September 19, 2022 06:13 ET (10:13 GMT)

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