MarketWise (NASDAQ:MKTW – Get Free Report) and Sound Point Meridian Capital (NYSE:SPMC – Get Free Report) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their risk, earnings, institutional ownership, dividends, analyst recommendations, valuation and profitability.
Analyst Recommendations
This is a summary of recent ratings and recommmendations for MarketWise and Sound Point Meridian Capital, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| MarketWise | 0 | 1 | 1 | 0 | 2.50 |
| Sound Point Meridian Capital | 0 | 2 | 1 | 1 | 2.75 |
Sound Point Meridian Capital has a consensus price target of $15.12, indicating a potential upside of 166.52%. Given Sound Point Meridian Capital’s stronger consensus rating and higher probable upside, analysts plainly believe Sound Point Meridian Capital is more favorable than MarketWise.
Valuation & Earnings
This table compares MarketWise and Sound Point Meridian Capital”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| MarketWise | $328.12 million | 1.07 | $5.62 million | $0.83 | 26.89 |
| Sound Point Meridian Capital | $72.51 million | 1.60 | -$118.49 million | ($5.78) | -0.98 |
MarketWise has higher revenue and earnings than Sound Point Meridian Capital. Sound Point Meridian Capital is trading at a lower price-to-earnings ratio than MarketWise, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares MarketWise and Sound Point Meridian Capital’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| MarketWise | 0.70% | -0.96% | 1.10% |
| Sound Point Meridian Capital | N/A | N/A | N/A |
Risk and Volatility
MarketWise has a beta of 0.28, suggesting that its stock price is 72% less volatile than the S&P 500. Comparatively, Sound Point Meridian Capital has a beta of 1.39, suggesting that its stock price is 39% more volatile than the S&P 500.
Insider and Institutional Ownership
23.0% of MarketWise shares are held by institutional investors. 29.9% of MarketWise shares are held by company insiders. Comparatively, 0.9% of Sound Point Meridian Capital shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Dividends
MarketWise pays an annual dividend of $1.00 per share and has a dividend yield of 4.5%. Sound Point Meridian Capital pays an annual dividend of $1.56 per share and has a dividend yield of 27.5%. MarketWise pays out 120.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sound Point Meridian Capital pays out -27.0% of its earnings in the form of a dividend. MarketWise has raised its dividend for 1 consecutive years. Sound Point Meridian Capital is clearly the better dividend stock, given its higher yield and lower payout ratio.
Summary
MarketWise beats Sound Point Meridian Capital on 9 of the 17 factors compared between the two stocks.
About MarketWise
MarketWise, Inc. operates a content and technology multi-brand platform for self-directed investors in the United States and Internationally. Its platform includes subscription businesses that provides financial research, software, education, and tools to navigate the financial markets. The company offers various investment strategies, such as value investing, income, growth, commodities, cryptocurrencies, venture, crowdfunded investing, biotechnology, mutual funds, options, and trading; investment research product portfolio through a range of media, including desktops, laptops, tablets, and mobile; and financial newsletters. It provides a suite of stock research tools and portfolio management services under the Chaikin Analytics brand; portfolio management software tools under the TradeSmith brand name; and database of accounting-based financial summaries under the Altimetry brand. In addition, the company develops screeners, monitors, portfolio management tools, and proprietary indicators that produce a composite score to rank publicly traded companies. The company was founded in 1999 and is headquartered in Baltimore, Maryland.
About Sound Point Meridian Capital
Sound Point Meridian Capital Inc. is an externally managed, non-diversified closed-end management investment company. Its investment objective is to generate high current income, with a secondary objective to generate capital appreciation, by investing primarily in third-party collateralized loan obligation equity and mezzanine tranches. Sound Point Meridian Capital Inc. is based in NEW YORK.
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