Brookfield (NYSE:BN – Get Free Report) and Oaktree Specialty Lending (NASDAQ:OCSL – Get Free Report) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, risk, dividends and earnings.
Profitability
This table compares Brookfield and Oaktree Specialty Lending’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Brookfield | 1.85% | 3.93% | 1.22% |
| Oaktree Specialty Lending | 14.45% | 9.70% | 4.64% |
Analyst Recommendations
This is a summary of current ratings and recommmendations for Brookfield and Oaktree Specialty Lending, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Brookfield | 1 | 1 | 10 | 1 | 2.85 |
| Oaktree Specialty Lending | 1 | 7 | 0 | 0 | 1.88 |
Brookfield presently has a consensus target price of $57.40, indicating a potential upside of 51.00%. Oaktree Specialty Lending has a consensus target price of $11.83, indicating a potential upside of 2.81%. Given Brookfield’s stronger consensus rating and higher possible upside, research analysts plainly believe Brookfield is more favorable than Oaktree Specialty Lending.
Insider and Institutional Ownership
61.6% of Brookfield shares are owned by institutional investors. Comparatively, 36.8% of Oaktree Specialty Lending shares are owned by institutional investors. 11.0% of Brookfield shares are owned by insiders. Comparatively, 0.3% of Oaktree Specialty Lending shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Dividends
Brookfield pays an annual dividend of $0.28 per share and has a dividend yield of 0.7%. Oaktree Specialty Lending pays an annual dividend of $1.20 per share and has a dividend yield of 10.4%. Brookfield pays out 50.9% of its earnings in the form of a dividend. Oaktree Specialty Lending pays out 250.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Brookfield has raised its dividend for 2 consecutive years.
Volatility & Risk
Brookfield has a beta of 1.56, indicating that its share price is 56% more volatile than the S&P 500. Comparatively, Oaktree Specialty Lending has a beta of 0.51, indicating that its share price is 49% less volatile than the S&P 500.
Earnings & Valuation
This table compares Brookfield and Oaktree Specialty Lending”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Brookfield | $75.10 billion | 1.24 | $1.31 billion | $0.55 | 69.11 |
| Oaktree Specialty Lending | $316.80 million | 3.20 | $33.92 million | $0.48 | 23.98 |
Brookfield has higher revenue and earnings than Oaktree Specialty Lending. Oaktree Specialty Lending is trading at a lower price-to-earnings ratio than Brookfield, indicating that it is currently the more affordable of the two stocks.
Summary
Brookfield beats Oaktree Specialty Lending on 13 of the 18 factors compared between the two stocks.
About Brookfield
Brookfield Corporation is an alternative asset manager and REIT/Real Estate Investment Manager firm focuses on real estate, renewable power, infrastructure and venture capital and private equity assets. It manages a range of public and private investment products and services for institutional and retail clients. It typically makes investments in sizeable, premier assets across geographies and asset classes. It invests both its own capital as well as capital from other investors. Within private equity and venture capital, it focuses on acquisition, early ventures, control buyouts and financially distressed, buyouts and corporate carve-outs, recapitalizations, convertible, senior and mezzanine financings, operational and capital structure restructuring, strategic re-direction, turnaround, and under-performing midmarket companies. It invests in both public debt and equity markets. It invests in private equity sectors with focus on Business Services include infrastructure, healthcare, road fuel distribution and marketing, construction and real estate; Industrials include manufacturers of automotive batteries, graphite electrodes, returnable plastic packaging, and sanitation management and development; and Residential/ infrastructure services. It targets companies which likely possess underlying real assets, primarily in sectors such as industrial products, building materials, metals, mining, homebuilding, oil and gas, paper and packaging, manufacturing and forest product sectors. It invests globally with focus on North America including Brazil, the United States, Canada; Europe; and Australia; and Asia-Pacific. The firm considers equity investments in the range of $2 million to $500 million. It has a four-year investment period and a 10-year term with two one-year extensions. The firm prefers to take minority stake and majority stake. Brookfield Corporation was founded in 1997 and based in Toronto, Canada with additional offices across Northern America; South America; Europe; Middle East and Asia.
About Oaktree Specialty Lending
Oaktree Specialty Lending Corporation is a business development company. The fund specializing in investments in middle market, bridge financing, first and second lien debt financing, unsecured and mezzanine loan, mezzanine debt, senior and junior secured debt, expansions, sponsor-led acquisitions, preferred equity, and management buyouts in small and mid-sized companies. It seeks to invest in education services, business services, retail and consumer, healthcare, manufacturing, food and restaurants, construction and engineering. The firm also seeks investment in media, advertising sectors, software, IT services, pharmaceuticals, biotechnology, real estate management and development, chemicals, machinery, and internet and direct marketing retail sectors. It invests between $5 million to $75 million principally in the form of one-stop, first lien, and second lien debt investments, which may include an equity co-investment component in companies. The firm invest in companies having enterprise value between $20 million and $150 million and EBITDA between $3 million and $50 million. The fund has a hold size of up to $75 million and may underwrite transactions up to $100 million. It primarily invests in North America. The fund seeks to be a lead investor in its portfolio companies.
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