Carlyle Secured Lending (NASDAQ:CGBD – Get Free Report) and Crescent Capital BDC (NASDAQ:CCAP – Get Free Report) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, earnings, profitability, risk, analyst recommendations and dividends.
Valuation and Earnings
This table compares Carlyle Secured Lending and Crescent Capital BDC”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Carlyle Secured Lending | $255.57 million | 2.90 | $69.97 million | $0.71 | 15.04 |
| Crescent Capital BDC | $167.29 million | 2.50 | $34.51 million | $0.41 | 27.73 |
Risk and Volatility
Carlyle Secured Lending has a beta of 0.66, suggesting that its share price is 34% less volatile than the S&P 500. Comparatively, Crescent Capital BDC has a beta of 0.59, suggesting that its share price is 41% less volatile than the S&P 500.
Profitability
This table compares Carlyle Secured Lending and Crescent Capital BDC’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Carlyle Secured Lending | 19.52% | 8.99% | 4.01% |
| Crescent Capital BDC | 9.26% | 9.34% | 4.04% |
Dividends
Carlyle Secured Lending pays an annual dividend of $1.60 per share and has a dividend yield of 15.0%. Crescent Capital BDC pays an annual dividend of $1.68 per share and has a dividend yield of 14.8%. Carlyle Secured Lending pays out 225.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Crescent Capital BDC pays out 409.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Crescent Capital BDC has increased its dividend for 1 consecutive years. Carlyle Secured Lending is clearly the better dividend stock, given its higher yield and lower payout ratio.
Insider and Institutional Ownership
24.5% of Carlyle Secured Lending shares are held by institutional investors. Comparatively, 49.5% of Crescent Capital BDC shares are held by institutional investors. 0.6% of Carlyle Secured Lending shares are held by insiders. Comparatively, 1.2% of Crescent Capital BDC shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Analyst Recommendations
This is a summary of current ratings for Carlyle Secured Lending and Crescent Capital BDC, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Carlyle Secured Lending | 0 | 4 | 3 | 0 | 2.43 |
| Crescent Capital BDC | 1 | 3 | 2 | 0 | 2.17 |
Carlyle Secured Lending currently has a consensus target price of $12.50, suggesting a potential upside of 17.04%. Crescent Capital BDC has a consensus target price of $14.30, suggesting a potential upside of 25.77%. Given Crescent Capital BDC’s higher possible upside, analysts plainly believe Crescent Capital BDC is more favorable than Carlyle Secured Lending.
Summary
Carlyle Secured Lending beats Crescent Capital BDC on 10 of the 17 factors compared between the two stocks.
About Carlyle Secured Lending
Carlyle Secured Lending, Inc. is business development company specializing in first lien debt, senior secured loans, second lien senior secured loan unsecured debt, mezzanine debt and investments in equities. It specializes in directly investing. It specializes in middle market. It targets healthcare and pharmaceutical, aerospace and defense, high tech industries, business services, software, beverage food and tobacco, hotel gamming and leisure, banking finance insurance and in real estate sector. The fund seeks to invest across United States of America, Luxembourg, Cayman Islands, Cyprus, and United Kingdom. It invests in companies with EBITDA between $25 million and $100 million.
About Crescent Capital BDC
Crescent Capital BDC, Inc. is as a business development company private equity / buyouts and loan fund. It specializes in directly investing. It specializes in middle market. The fund seeks to invest in United States.
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