TriplePoint Venture Growth BDC (NYSE:TPVG) & WhiteHorse Finance (NASDAQ:WHF) Head-To-Head Review

WhiteHorse Finance (NASDAQ:WHF) and TriplePoint Venture Growth BDC (NYSE:TPVG) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, profitability, risk, analyst recommendations, dividends, institutional ownership and valuation.

Institutional & Insider Ownership

13.2% of WhiteHorse Finance shares are owned by institutional investors. Comparatively, 12.8% of TriplePoint Venture Growth BDC shares are owned by institutional investors. 2.5% of WhiteHorse Finance shares are owned by company insiders. Comparatively, 1.5% of TriplePoint Venture Growth BDC shares are owned 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.

Earnings and Valuation

This table compares WhiteHorse Finance and TriplePoint Venture Growth BDC”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
WhiteHorse Finance	$92.82 million	1.59	$10.85 million	$0.43	14.79
TriplePoint Venture Growth BDC	$108.65 million	2.08	$32.05 million	$0.85	6.57

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

Profitability

This table compares WhiteHorse Finance and TriplePoint Venture Growth BDC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
WhiteHorse Finance	12.91%	9.93%	4.14%
TriplePoint Venture Growth BDC	36.02%	12.88%	5.76%

Analyst Recommendations

This is a summary of current ratings and recommmendations for WhiteHorse Finance and TriplePoint Venture Growth BDC, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
WhiteHorse Finance	2	3	0	0	1.60
TriplePoint Venture Growth BDC	1	6	0	0	1.86

WhiteHorse Finance currently has a consensus target price of $7.75, suggesting a potential upside of 21.86%. TriplePoint Venture Growth BDC has a consensus target price of $6.25, suggesting a potential upside of 11.91%. Given WhiteHorse Finance’s higher possible upside, equities research analysts plainly believe WhiteHorse Finance is more favorable than TriplePoint Venture Growth BDC.

Dividends

WhiteHorse Finance pays an annual dividend of $1.00 per share and has a dividend yield of 15.7%. TriplePoint Venture Growth BDC pays an annual dividend of $0.92 per share and has a dividend yield of 16.5%. WhiteHorse Finance pays out 232.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TriplePoint Venture Growth BDC pays out 108.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. WhiteHorse Finance has raised its dividend for 3 consecutive years. TriplePoint Venture Growth BDC is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

WhiteHorse Finance has a beta of 0.56, indicating that its stock price is 44% less volatile than the S&P 500. Comparatively, TriplePoint Venture Growth BDC has a beta of 1.36, indicating that its stock price is 36% more volatile than the S&P 500.

Summary

TriplePoint Venture Growth BDC beats WhiteHorse Finance on 11 of the 16 factors compared between the two stocks.

About WhiteHorse Finance

WhiteHorse Finance, Inc. is business development company, non-diversified, closed end management company specializing in originating senior secured loans, lower middle market, growth capital industries. It invests in broadline retail, office services and supplies, building products, health care services, health care supplies, research and consulting services, application software, home furnishings, specialized consumer services, data processing and outsourced services, leisure facilities, cable, and satellite. It prefers to invest in United States. It typically invests between $5 million to $25 million in companies having enterprise value of between $50 million and $350 million.

About TriplePoint Venture Growth BDC

TriplePoint Venture Growth BDC Corp. is a business development company specializing investments in venture capital-backed companies at the growth stage investments. It also provides debt financing to venture growth space companies which includes growth capital loans, secured and customized loans, equipment financings, revolving loans and direct equity investments. The fund seeks to invest in e-commerce, entertainment, technology and life sciences sector. Within technology the areas of focus include: Security, wireless communication equipments, network system and software, business applications software, conferencing equipments/services .big data, cloud computing, data storage, electronics, energy efficiency, hardware, information services, internet and media, networking, semiconductors, software, software as a service, and other technology related subsectors and within life sciences the areas of focus include: biotechnology, bio fuels/bio mass, diagnostic testing and bioinformatics, drug delivery, drug discovery, healthcare information systems, healthcare services, medical, surgical and therapeutic devices, pharmaceuticals and other life science related subsectors. Within growth capital loans it invests between $5 million and $50 million, for equipment financings it invests between $5 million and $25 million, for revolving loans it invests between $1 million and $25 million, and for direct equity investments it may invest between $0.1 million and $5 million (generally not exceeding 5% of the company’s total equity). The debt financing products are typically structured as lines of credit and it invests through warrants and secured loans. It targeted returns between 10% and 18%. It does not take board seat in the company.