WhiteHorse Finance (NASDAQ: WHF) and BlackRock Enhanced Global Dividend Trust (NYSE:BOE) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, valuation, risk, institutional ownership, profitability, analyst recommendations and dividends.
Earnings and Valuation
This table compares WhiteHorse Finance and BlackRock Enhanced Global Dividend Trust’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|WhiteHorse Finance||$53.85 million||4.57||$31.32 million||$1.86||6.45|
|BlackRock Enhanced Global Dividend Trust||N/A||N/A||N/A||N/A||N/A|
WhiteHorse Finance has higher revenue and earnings than BlackRock Enhanced Global Dividend Trust.
Insider and Institutional Ownership
9.2% of WhiteHorse Finance shares are owned by institutional investors. 1.4% of WhiteHorse Finance shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
This table compares WhiteHorse Finance and BlackRock Enhanced Global Dividend Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|BlackRock Enhanced Global Dividend Trust||N/A||N/A||N/A|
This is a summary of current ratings for WhiteHorse Finance and BlackRock Enhanced Global Dividend Trust, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|BlackRock Enhanced Global Dividend Trust||0||0||0||0||N/A|
WhiteHorse Finance presently has a consensus target price of $15.00, indicating a potential upside of 25.10%. Given WhiteHorse Finance’s higher possible upside, equities research analysts clearly believe WhiteHorse Finance is more favorable than BlackRock Enhanced Global Dividend Trust.
WhiteHorse Finance pays an annual dividend of $1.42 per share and has a dividend yield of 11.8%. BlackRock Enhanced Global Dividend Trust does not pay a dividend. WhiteHorse Finance pays out 76.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Risk and Volatility
WhiteHorse Finance has a beta of 0.66, suggesting that its stock price is 34% less volatile than the S&P 500. Comparatively, BlackRock Enhanced Global Dividend Trust has a beta of 0.99, suggesting that its stock price is 1% less volatile than the S&P 500.
WhiteHorse Finance beats BlackRock Enhanced Global Dividend Trust on 9 of the 11 factors compared between the two stocks.
About WhiteHorse Finance
WhiteHorse Finance, Inc. is a non-diversified, closed-end management investment company. The Company is a direct lender targeting debt investments in privately held, small-cap companies located in the United States. The Company’s investment objective is to generate attractive risk-adjusted returns primarily by originating and investing in senior secured loans, including first lien and second lien facilities, to performing small-cap companies across a range of industries that typically carry a floating interest rate based on the London Interbank Offered Rate (LIBOR) and have a term of 3 to 6 years. The Company may also make investments at other levels of a company’s capital structure, including mezzanine loans or equity interests. The Company also may receive warrants to purchase common stock in connection with its debt investments. Its investment advisor is H.I.G. WhiteHorse Advisers, LLC.
About BlackRock Enhanced Global Dividend Trust
BlackRock Enhanced Global Dividend Trust (the Trust), formerly BlackRock Global Opportunities Equity Trust, is a diversified, closed-end management investment company. The Trust’s investment objective is to provide current income and current gains, with a secondary objective of long-term capital appreciation. The Trust seeks to achieve its investment objectives by investing primarily in equity securities issued by companies located in countries throughout the world and utilizing an option writing (selling) strategy. The Trust focuses on investing in sectors, including information technology, financials, healthcare, materials, energy and utilities. The Trust invests at least 80% of its assets in equity securities or options on equity securities or indices or sectors of equity securities. The Trust invests amount of its total assets in foreign issuers. BlackRock Advisors, LLC is its investment advisor.
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