Capitala Finance Corp. (NASDAQ: CPTA) is one of 576 publicly-traded companies in the “Closed End Funds” industry, but how does it weigh in compared to its peers? We will compare Capitala Finance Corp. to related businesses based on the strength of its earnings, risk, profitability, institutional ownership, dividends, analyst recommendations and valuation.

Analyst Ratings

This is a breakdown of recent recommendations for Capitala Finance Corp. and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Capitala Finance Corp. 0 4 3 0 2.43
Capitala Finance Corp. Competitors 197 1200 1418 14 2.44

Capitala Finance Corp. presently has a consensus target price of $14.92, suggesting a potential upside of 65.19%. As a group, “Closed End Funds” companies have a potential upside of 45.84%. Given Capitala Finance Corp.’s higher probable upside, equities analysts clearly believe Capitala Finance Corp. is more favorable than its peers.

Volatility & Risk

Capitala Finance Corp. has a beta of 1.11, meaning that its stock price is 11% more volatile than the S&P 500. Comparatively, Capitala Finance Corp.’s peers have a beta of 0.55, meaning that their average stock price is 45% less volatile than the S&P 500.

Earnings & Valuation

This table compares Capitala Finance Corp. and its peers revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Capitala Finance Corp. N/A N/A 26.56
Capitala Finance Corp. Competitors $57.58 million $38.86 million 0.07

Capitala Finance Corp.’s peers have higher revenue and earnings than Capitala Finance Corp.. Capitala Finance Corp. is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Institutional and Insider Ownership

28.2% of Capitala Finance Corp. shares are held by institutional investors. Comparatively, 23.2% of shares of all “Closed End Funds” companies are held by institutional investors. 8.4% of Capitala Finance Corp. shares are held by insiders. Comparatively, 3.5% of shares of all “Closed End Funds” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Capitala Finance Corp. pays an annual dividend of $1.56 per share and has a dividend yield of 17.3%. Capitala Finance Corp. pays out 458.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Closed End Funds” companies pay a dividend yield of 8.8% and pay out 87.0% of their earnings in the form of a dividend.

Profitability

This table compares Capitala Finance Corp. and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Capitala Finance Corp. 8.91% 8.55% 3.66%
Capitala Finance Corp. Competitors -47.97% 6.89% 5.31%

Summary

Capitala Finance Corp. beats its peers on 8 of the 14 factors compared.

About Capitala Finance Corp.

Capitala Finance Corp. is an externally managed non-diversified, closed-end management investment company. The Company’s investment objective is to generate both current income and capital appreciation through debt and equity investments. Both directly and through its subsidiaries that are licensed by the United States Small Business Administration (SBA), the Company offers financing to business owners, management teams and financial sponsors for change of ownership transactions, recapitalizations, strategic acquisitions, business expansion and other growth initiatives. The Company provides capital to lower and traditional middle-market companies in the United States, with a non-exclusive emphasis on the Southeast, Southwest and Mid-Atlantic regions. The Company invests in first lien, second lien and subordinated loans. The Company’s investment advisor is Capitala Investment Advisors, LLC.

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