Head to Head Review: Bitfarms (NASDAQ:BITF) vs. Runway Growth Finance (NASDAQ:RWAY)

Runway Growth Finance (NASDAQ:RWAY) and Bitfarms (NASDAQ:BITF) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, profitability, dividends, analyst recommendations, valuation, institutional ownership and risk.

Earnings & Valuation

This table compares Runway Growth Finance and Bitfarms’ gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Runway Growth Finance	$164.21 million	3.27	$44.34 million	$1.10	12.05
Bitfarms	$146.37 million	4.45	-$104.04 million	($0.37)	-4.95

Runway Growth Finance has higher revenue and earnings than Bitfarms. Bitfarms is trading at a lower price-to-earnings ratio than Runway Growth Finance, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

64.6% of Runway Growth Finance shares are owned by institutional investors. Comparatively, 20.6% of Bitfarms shares are owned by institutional investors. 1.0% of Runway Growth Finance shares are owned by company insiders. Comparatively, 9.5% of Bitfarms shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Runway Growth Finance has a beta of 0.65, meaning that its share price is 35% less volatile than the S&P 500. Comparatively, Bitfarms has a beta of 3.65, meaning that its share price is 265% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and price targets for Runway Growth Finance and Bitfarms, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Runway Growth Finance	0	5	1	0	2.17
Bitfarms	0	0	5	0	3.00

Runway Growth Finance currently has a consensus target price of $13.25, suggesting a potential upside of 0.00%. Bitfarms has a consensus target price of $4.20, suggesting a potential upside of 129.51%. Given Bitfarms’ stronger consensus rating and higher possible upside, analysts clearly believe Bitfarms is more favorable than Runway Growth Finance.

Profitability

This table compares Runway Growth Finance and Bitfarms’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Runway Growth Finance	27.00%	13.85%	7.07%
Bitfarms	-70.53%	-19.58%	-16.13%

Summary

Runway Growth Finance beats Bitfarms on 8 of the 14 factors compared between the two stocks.

About Runway Growth Finance

Runway Growth Finance Corp. is a business development company specializing investments in senior-secured loans to late stage and growth companies. It prefers to make investments in companies engaged in the technology, life sciences, healthcare and information services, business services and select consumer services and products sectors. It prefers to investments in companies engaged in electronic equipment and instruments, systems software, hardware, storage and peripherals and specialized consumer services, application software, healthcare technology, internet software and services, data processing and outsourced services, internet retail, human resources and employment services, biotechnology, healthcare equipment and education services. It invests in senior secured loans between $10 million and $75 million.

About Bitfarms

Bitfarms Ltd. engages in the mining of cryptocurrency coins and tokens in Canada, the United States, Paraguay, and Argentina. It owns and operates server farms that primarily validates transactions on the Bitcoin Blockchain and earning cryptocurrency from block rewards and transaction fees. The company also provides electrician services to commercial and residential customers in Quebec, Canada. It also undertakes hosting of third-party mining hardware. The company was founded in 2017 and is based in Toronto, Canada.