Hamilton Lane (NASDAQ:HLNE – Get Free Report) and Crescent Capital BDC (NASDAQ:CCAP – Get Free Report) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, analyst recommendations, valuation, dividends, risk, profitability and institutional ownership.
Dividends
Hamilton Lane pays an annual dividend of $2.40 per share and has a dividend yield of 2.7%. Crescent Capital BDC pays an annual dividend of $1.36 per share and has a dividend yield of 13.8%. Hamilton Lane pays out 36.6% of its earnings in the form of a dividend. Crescent Capital BDC pays out -1,511.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Hamilton Lane has increased its dividend for 8 consecutive years and Crescent Capital BDC has increased its dividend for 1 consecutive years. Crescent Capital BDC is clearly the better dividend stock, given its higher yield and lower payout ratio.
Earnings and Valuation
This table compares Hamilton Lane and Crescent Capital BDC”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Hamilton Lane | $758.99 million | 6.58 | $249.18 million | $6.56 | 13.70 |
| Crescent Capital BDC | $167.29 million | 2.18 | $34.51 million | ($0.09) | -109.78 |
Hamilton Lane has higher revenue and earnings than Crescent Capital BDC. Crescent Capital BDC is trading at a lower price-to-earnings ratio than Hamilton Lane, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent ratings for Hamilton Lane and Crescent Capital BDC, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Hamilton Lane | 0 | 2 | 6 | 1 | 2.89 |
| Crescent Capital BDC | 0 | 6 | 1 | 0 | 2.14 |
Hamilton Lane presently has a consensus target price of $131.57, indicating a potential upside of 46.39%. Crescent Capital BDC has a consensus target price of $12.62, indicating a potential upside of 27.78%. Given Hamilton Lane’s stronger consensus rating and higher possible upside, research analysts clearly believe Hamilton Lane is more favorable than Crescent Capital BDC.
Insider & Institutional Ownership
97.4% of Hamilton Lane shares are held by institutional investors. Comparatively, 49.5% of Crescent Capital BDC shares are held by institutional investors. 24.0% of Hamilton Lane shares are held by company insiders. Comparatively, 1.2% of Crescent Capital BDC shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Profitability
This table compares Hamilton Lane and Crescent Capital BDC’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Hamilton Lane | 32.14% | 25.10% | 15.75% |
| Crescent Capital BDC | -2.02% | 9.02% | 3.82% |
Volatility and Risk
Hamilton Lane has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500. Comparatively, Crescent Capital BDC has a beta of 0.52, suggesting that its share price is 48% less volatile than the S&P 500.
Summary
Hamilton Lane beats Crescent Capital BDC on 16 of the 18 factors compared between the two stocks.
About Hamilton Lane
Hamilton Lane Incorporated is a private equity firm specializing in early venture, emerging growth, turnaround, middle market, mature, mid-venture, bridge, buyout, distressed/vulture, loan, mezzanine in growth capital companies. It prefers to invest in energy, industrials, consumer discretionary, health care, real estate, information technology, utilities, and consumer services. The firm prefers to invest in Africa/Middle East, Asia/Pacific, Europe, Latin America and Caribbean, United States of America, and Canada. The firm prefers to invest between $1 million and $100 million. It prefers to take majority stake. Hamilton Lane Incorporated was founded in 1991 and is based in Conshohocken, Pennsylvania with additional offices across Europe, North America, Asia Pacific and the Middle East.
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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