Analyzing Runway Growth Finance (NASDAQ:RWAY) & Apollo Global Management (NYSE:APO)

Apollo Global Management (NYSE:APO) and Runway Growth Finance (NASDAQ:RWAY) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, profitability, dividends, valuation, analyst recommendations, risk and earnings.

Institutional and Insider Ownership

77.1% of Apollo Global Management shares are held by institutional investors. Comparatively, 64.6% of Runway Growth Finance shares are held by institutional investors. 8.3% of Apollo Global Management shares are held by insiders. Comparatively, 1.0% of Runway Growth Finance shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Volatility & Risk

Apollo Global Management has a beta of 1.51, indicating that its stock price is 51% more volatile than the S&P 500. Comparatively, Runway Growth Finance has a beta of 0.7, indicating that its stock price is 30% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Apollo Global Management and Runway Growth Finance, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Apollo Global Management	1	6	12	0	2.58
Runway Growth Finance	1	4	2	0	2.14

Apollo Global Management presently has a consensus target price of $145.21, indicating a potential upside of 17.70%. Runway Growth Finance has a consensus target price of $8.40, indicating a potential upside of 25.37%. Given Runway Growth Finance’s higher possible upside, analysts plainly believe Runway Growth Finance is more favorable than Apollo Global Management.

Dividends

Apollo Global Management pays an annual dividend of $2.25 per share and has a dividend yield of 1.8%. Runway Growth Finance pays an annual dividend of $1.32 per share and has a dividend yield of 19.7%. Apollo Global Management pays out -123.0% of its earnings in the form of a dividend. Runway Growth Finance pays out 880.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Apollo Global Management has raised its dividend for 3 consecutive years.

Profitability

This table compares Apollo Global Management and Runway Growth Finance’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Apollo Global Management	-2.98%	12.11%	0.98%
Runway Growth Finance	7.62%	11.73%	5.41%

Valuation & Earnings

This table compares Apollo Global Management and Runway Growth Finance”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Apollo Global Management	$32.05 billion	2.27	$3.49 billion	($1.83)	-67.42
Runway Growth Finance	$137.33 million	2.01	$34.05 million	$0.15	44.67

Apollo Global Management has higher revenue and earnings than Runway Growth Finance. Apollo Global Management 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.

Summary

Apollo Global Management beats Runway Growth Finance on 12 of the 17 factors compared between the two stocks.

About Apollo Global Management

Apollo Global Management is a global alternative asset manager that provides investment management and retirement services. Its investment strategies span private equity, credit and real assets, including infrastructure, and it serves institutional and individual investors. The company was founded in 1990 by Leon Black, Josh Harris and Marc Rowan. It has since expanded its investment businesses and retirement-services operations, including through Athene, its retirement services platform. Apollo operates across global markets and is led by co-founder Marc Rowan, who serves as chief executive officer.

About Runway Growth Finance

Runway Growth Finance Corp. is a business development company that provides debt financing to growth-stage businesses. Its investments are primarily loans to companies that may have limited access to traditional financing as they expand. The company focuses on senior secured loans and other debt investments, sometimes including equity-related features. It is externally managed by Runway Growth Capital LLC, an investment firm specializing in lending to growth companies. Runway Growth Finance began operations in 2015 and primarily serves businesses in the United States and Canada.