Manhattan Bridge Capital, Inc. :LOAN-US: Earnings Analysis: Q3, 2016 By the Numbers : October 28, 2016

Manhattan Bridge Capital, Inc. reports financial results for the quarter ended September 30, 2016.

We analyze the earnings along side the following peers of Manhattan Bridge Capital, Inc. – Arlington Asset Investment Corp. Class A (AI-US) that have also reported for this period.

Highlights

  • Summary numbers: Revenues of USD 1.17 million, Net Earnings of USD 0.72 million.
  • Gross margins narrowed from 99.91% to 99.81% compared to the same period last year, operating (EBITDA) margins now 62.05% from 62.30%.
  • Year-on-year change in operating cash flow of 3.43% is about the same as the change in earnings, likely no significant movement in accruals or reserves.
  • Earnings rose compared to same period last year, despite decline in operating and pretax margins.

The table below shows the preliminary results and recent trends for key metrics such as revenues and net income (See complete table at the end of this report):

2015-09-30 2015-12-31 2016-03-31 2016-06-30 2016-09-30
Relevant Numbers (Quarterly)
Revenues (mil) 1.03 1.15 1.1 1.17 1.17
Revenue Growth (%YOY) 34.74 27.39 21.15 27.85 13.33
Earnings (mil) 0.64 0.59 0.7 0.71 0.72
Earnings Growth (%YOY) 48.95 49.54 46.2 33.86 13.39
Net Margin (%) 61.94 51.74 62.95 60.9 61.97
EPS 0.09 0.08 0.1 0.1 0.1
Return on Equity (%) 14.03 13.17 15.37 15.32 13.88
Return on Assets (%) 9.08 7.72 8.97 8.81 8.62

Access our Ratings and Scores for Manhattan Bridge Capital, Inc.

Market Share Versus Profits

Revenues History
Earnings History

LOAN-US‘s change in revenue this period compared to the same period last year of 13.33% is almost the same as its change in earnings, and is about average among the announced results thus far in its peer group, suggesting that LOAN-US is holding onto its market share. Also, for comparison purposes, revenues changed by 0.29% and earnings by 2.04% compared to the immediate last period.

Revenues Growth Versus Earnings Growth

Quadrant label definitions. Hover to know more

Leader, Earnings Focus, Laggard, Revenues Focus

Earnings Growth Analysis

The company’s earnings rose year-on-year. But this growth has not come as a result of improvement in gross margins or any cost control activities in its operations. Gross margins went from 99.81% to 99.91% for the same period last year, while operating margins (EBITDA margins) went from 62.05% to 62.30% over the same time frame.

Gross Margin Versus EBITDA Margin

Quadrant label definitions. Hover to know more

Differentiated; Low Cost, Commodity; Low Cost, Commodity; High Cost, Differentiated; High Cost

Cash Versus Earnings – Sustainable Performance?

Operating Cash Flow Growth Versus Earnings Growth

Quadrant label definitions. Hover to know more

Cash Flow based Earnings, Likely Non-cash Earnings, Low Cash Flow Base, Likely Undeclared Earnings

LOAN-US‘s change in operating cash flow of 3.43% compared to the same period last year is about the same as its change in earnings this period. Additionally, this change in operating cash flow is about average among its peer group. This suggests that the company did not use accruals or reserves to manage earnings this period, and that, all else being equal, the earnings number is sustainable.

Margins

Despite a decline in operating (EBIT) margins as well as a decline in pretax margins, the company’s earnings rose.

EBIT Margin Versus PreTax Margin

Quadrant label definitions. Hover to know more

Operation driven Earnings, One-time Favorables, Low Earnings Base, One-time Unfavorables
EBIT Margin History
PreTax Margin History

Access our Ratings and Scores for Manhattan Bridge Capital, Inc.

Company Profile

Manhattan Bridge Capital, Inc. is a real estate finance company, which specializes in originating, servicing and managing a portfolio of first mortgage loans. It offers short-term, secured, non-banking loans to real estate investors to fund their acquisition and construction of properties located in the New York Metropolitan area. The loans are principally secured by collateral consisting of real estate and, generally, accompanied by personal guarantees from the principals of the businesses. The company was founded by Assaf N. Ran in 1989 and is headquartered in Great Neck, NY.

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