Analyzing PennantPark Investment (PNNT) and Amern Cap Sr Fl/COM (ACSF)

PennantPark Investment (NASDAQ:PNNT) and Amern Cap Sr Fl/COM (OTCMKTS:ACSF) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their earnings, institutional ownership, valuation, risk, dividends, profitability and analyst recommendations.

Dividends

PennantPark Investment pays an annual dividend of $0.72 per share and has a dividend yield of 11.0%. Amern Cap Sr Fl/COM pays an annual dividend of $1.07 per share and has a dividend yield of 8.7%. PennantPark Investment pays out 96.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Institutional & Insider Ownership

45.0% of PennantPark Investment shares are held by institutional investors. Comparatively, 27.1% of Amern Cap Sr Fl/COM shares are held by institutional investors. 2.0% of PennantPark Investment shares are held by company insiders. Comparatively, 0.2% of Amern Cap Sr Fl/COM shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares PennantPark Investment and Amern Cap Sr Fl/COM’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PennantPark Investment 28.97% 7.94% 4.09%
Amern Cap Sr Fl/COM N/A N/A N/A

Valuation and Earnings

This table compares PennantPark Investment and Amern Cap Sr Fl/COM’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
PennantPark Investment $108.28 million 4.07 $47.71 million $0.75 8.76
Amern Cap Sr Fl/COM N/A N/A N/A N/A N/A

PennantPark Investment has higher revenue and earnings than Amern Cap Sr Fl/COM.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for PennantPark Investment and Amern Cap Sr Fl/COM, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PennantPark Investment 0 4 1 0 2.20
Amern Cap Sr Fl/COM 0 0 0 0 N/A

PennantPark Investment currently has a consensus target price of $7.50, indicating a potential upside of 14.16%. Given PennantPark Investment’s higher probable upside, analysts clearly believe PennantPark Investment is more favorable than Amern Cap Sr Fl/COM.

Summary

PennantPark Investment beats Amern Cap Sr Fl/COM on 9 of the 10 factors compared between the two stocks.

PennantPark Investment Company Profile

PennantPark Investment Corporation specializes in direct and mezzanine investments in middle market companies. It invests in the form of mezzanine debt, senior secured loans, and equity investments. The fund typically invests in building and real estate, hotels and gaming, electronics, healthcare, education and childcare, financial services, printing and publishing, consumer products, business services, energy and utilities, distribution, oil and gas, media, environmental services, aerospace and defense, manufacturing industries and retail. It invests in equity securities and debt transactions through preferred stock, common stock, warrants, options, subordinated loans, mezzanine loans, and senior secured loans. It seeks to invest in companies based in the United States. The fund seeks to invest between $10 million and $50 million in its portfolio companies. Its mezzanine loans, senior secured loans, and other investments in its portfolio companies are between $15 million and $50 million. The fund may also make non-control equity and debt investments.

Amern Cap Sr Fl/COM Company Profile

American Capital Senior Floating, Ltd. is a business development company specializing in first lien and second lien floating rate loans. It also invests in equity tranches of collateralized loan obligations equity tranches of collateralized loan obligations.

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