Medley Management (NYSE: MDLY) and Hamilton Lane (NASDAQ:HLNE) are both small-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, risk, valuation, profitability and dividends.

Valuation and Earnings

This table compares Medley Management and Hamilton Lane’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Medley Management $67.57 million 0.52 $27.69 million $0.19 34.74
Hamilton Lane $192.96 million 2.28 $87.34 million N/A N/A

Hamilton Lane has higher revenue and earnings than Medley Management.

Insider & Institutional Ownership

70.2% of Medley Management shares are owned by institutional investors. Comparatively, 61.4% of Hamilton Lane shares are owned by institutional investors. 5.1% of Medley Management shares are owned by insiders. Comparatively, 62.9% of Hamilton Lane shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Medley Management and Hamilton Lane’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Medley Management 2.68% -45.80% 17.74%
Hamilton Lane N/A N/A N/A

Analyst Ratings

This is a summary of recent recommendations and price targets for Medley Management and Hamilton Lane, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Medley Management 0 3 1 0 2.25
Hamilton Lane 0 3 2 0 2.40

Medley Management presently has a consensus target price of $9.06, indicating a potential upside of 37.31%. Hamilton Lane has a consensus target price of $21.25, indicating a potential downside of 6.84%. Given Medley Management’s higher possible upside, analysts clearly believe Medley Management is more favorable than Hamilton Lane.

Dividends

Medley Management pays an annual dividend of $0.80 per share and has a dividend yield of 12.1%. Hamilton Lane pays an annual dividend of $0.70 per share and has a dividend yield of 3.1%. Medley Management pays out 421.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Hamilton Lane beats Medley Management on 9 of the 14 factors compared between the two stocks.

Medley Management Company Profile

Medley Management Inc. is an asset management firm offering yield solutions to retail and institutional investors. The Company operates in the investment management segment. It is focused on credit-related investment strategies, primarily originating senior secured loans to private middle market companies in the United States. The Company generally holds these loans to maturity. Its national direct origination franchise provides capital to the middle market in the United States. The Company has over $4.8 billion of assets under management (AUM) in approximately two business development companies (BDCs), Medley Capital Corporation (MCC) and Sierra Income Corporation (SIC), as well as private investment vehicles. It has over $5 billion of AUM. The Company provides capital to over 300 companies across approximately 35 industries in North America. The Company’s long-dated private funds include MOF I, MOF II and MOF III. Its private funds are managed through partnership structures

Hamilton Lane Company Profile

Hamilton Lane Incorporated is a global private markets investment solutions provider. The Company works with its clients to conceive, structure, build out, manage and monitor portfolios of private markets funds and direct investments, and it helps them access a set of such investment opportunities around the world. It offers a range of investment solutions across a range of private markets, including private equity, private credit, real estate, infrastructure, natural resources, growth equity and venture capital. These solutions are constructed from a range of investment types, including primary investments in funds managed by third-party managers, direct/co-investments alongside such funds and acquisitions of secondary stakes in such funds, with a range of its clients utilizing multiple investment types. These solutions are offered in a range of formats covering some or all phases of private markets investment programs, such as Customized Separate Accounts and Specialized Funds.

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