Head-To-Head Review: Compass Diversified (NYSE:CODI) & Royce Otc Micro (NYSE:RMT)

Compass Diversified (NYSE:CODI – Get Free Report) and Royce Otc Micro (NYSE:RMT – Get Free Report) are both small-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, valuation, institutional ownership, earnings, profitability, risk and analyst recommendations.

Analyst Ratings

This is a breakdown of current ratings for Compass Diversified and Royce Otc Micro, as reported by MarketBeat.

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Compass Diversified presently has a consensus price target of $12.75, suggesting a potential upside of 11.50%. Given Compass Diversified’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Compass Diversified is more favorable than Royce Otc Micro.

Institutional and Insider Ownership

72.7% of Compass Diversified shares are held by institutional investors. Comparatively, 35.0% of Royce Otc Micro shares are held by institutional investors. 1.6% of Compass Diversified shares are held by company insiders. Comparatively, 0.2% of Royce Otc Micro shares are held by company 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.

Profitability

This table compares Compass Diversified and Royce Otc Micro’s net margins, return on equity and return on assets.

Volatility & Risk

Compass Diversified has a beta of 1.29, suggesting that its stock price is 29% more volatile than the S&P 500. Comparatively, Royce Otc Micro has a beta of 1.17, suggesting that its stock price is 17% more volatile than the S&P 500.

Valuation and Earnings

This table compares Compass Diversified and Royce Otc Micro”s top-line revenue, earnings per share (EPS) and valuation.

Royce Otc Micro has lower revenue, but higher earnings than Compass Diversified.

Summary

Compass Diversified beats Royce Otc Micro on 8 of the 10 factors compared between the two stocks.

About Compass Diversified

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Compass Diversified is a private equity firm specializing in add on acquisitions, buyouts, industry consolidation, recapitalization, late stage and middle market investments. It seeks to invest in niche industrial or branded consumer companies, manufacturing, distribution, consumer products, business services sector, healthcare, safety & security, electronic components, food and foodservice. The firm prefers to invest in companies based in North America. It seeks to invest between $100 million and $800 million in companies with an EBITDA between $15 million to $80 million. It seeks to acquire controlling ownership interests in its portfolio companies and can make additional platform acquisitions. The firm prefer to have majority stake in companies. The firm invests through its balance sheet and typically holds investments between five to seven years. Compass Diversified was founded in 2006 and is based in Westport, Connecticut with an additional office in Costa Mesa, California.

About Royce Otc Micro

(Get Free Report)

Royce Micro-Cap Trust, Inc. is a closed-ended equity mutual fund launched and managed Royce & Associates, LLC. It invests in the public equity markets of the United States. The fund seeks to invest in stocks of companies operating across diversified sectors. It primarily invests in value stocks of companies with market capitalization of less than $500 million. The fund benchmarks the performance of its portfolios against Russell 2000 Index. Royce Micro-Cap Trust, Inc was formed on December 14, 1993 and is domiciled in the United States.

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