Apollo Investment (NASDAQ: AINV) and TICC Capital (NASDAQ:TICC) are both small-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, earnings, profitability, risk and institutional ownership.
Volatility & Risk
Apollo Investment has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500. Comparatively, TICC Capital has a beta of 0.43, meaning that its share price is 57% less volatile than the S&P 500.
Apollo Investment pays an annual dividend of $0.60 per share and has a dividend yield of 10.9%. TICC Capital pays an annual dividend of $0.80 per share and has a dividend yield of 13.1%. Apollo Investment pays out 176.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TICC Capital pays out 94.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TICC Capital is clearly the better dividend stock, given its higher yield and lower payout ratio.
This table compares Apollo Investment and TICC Capital’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation and Earnings
This table compares Apollo Investment and TICC Capital’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Apollo Investment||$279.86 million||4.24||$18.37 million||$0.34||16.12|
|TICC Capital||$61.42 million||5.11||$43.60 million||$0.85||7.21|
TICC Capital has lower revenue, but higher earnings than Apollo Investment. TICC Capital is trading at a lower price-to-earnings ratio than Apollo Investment, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
48.8% of Apollo Investment shares are held by institutional investors. Comparatively, 16.5% of TICC Capital shares are held by institutional investors. 0.3% of Apollo Investment shares are held by insiders. Comparatively, 5.9% of TICC Capital shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This is a breakdown of current ratings and recommmendations for Apollo Investment and TICC Capital, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Apollo Investment currently has a consensus target price of $6.38, indicating a potential upside of 16.33%. TICC Capital has a consensus target price of $5.50, indicating a potential downside of 10.28%. Given Apollo Investment’s stronger consensus rating and higher probable upside, equities analysts plainly believe Apollo Investment is more favorable than TICC Capital.
Apollo Investment Company Profile
Apollo Investment Corporation is a closed-end, externally managed, non-diversified management investment company. The Company’s investment objective is to generate current income and capital appreciation. It invests primarily in various forms of debt investments, including secured and unsecured debt, loan investments and/or equity in private middle-market companies. It may also invest in the securities of public companies and in structured products and other investments, such as collateralized loan obligations (CLOs) and credit-linked notes (CLNs). Its portfolio also includes equity interests, such as common stock, preferred stock, warrants or options. It invests in investments in the United States secured and unsecured loans, other debt securities and equity, and may also invests a portion of the portfolio in other investment opportunities, including foreign securities and structured products. Apollo Investment Management, L.P. is the investment advisor of the Company.
TICC Capital Company Profile
TICC Capital Corp. is a closed-end, non-diversified management investment company. The Company’s investment objective is to maximize its portfolio’s total return. The Company primarily focuses on seeking current income by investing primarily in corporate debt securities. The Company’s debt investments may include syndicated loans and bilateral loans. The Company holds interests in structured finance investments, including collateralized loan obligation (CLO) investment vehicles that own debt securities. CLO investments may also include warehouse facilities, which are financing structures intended to aggregate loans that may be used to form the basis of a CLO vehicle. The Company may also invest in publicly traded debt and/or equity securities. Its portfolio includes its investments in various industries, such as structured finance, telecommunication services, business services, printing and publishing, and financial intermediaries. TICC Management, LLC is its investment advisor.
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