Comparing StoneCastle Financial (BANX) and TriplePoint Venture Growth BDC (TPVG)

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

Valuation and Earnings

This table compares StoneCastle Financial and TriplePoint Venture Growth BDC’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
StoneCastle Financial $17.03 million 7.89 $7.01 million $1.76 11.68
TriplePoint Venture Growth BDC $43.63 million 5.33 $11.12 million $1.41 9.32

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

Volatility & Risk

StoneCastle Financial has a beta of 0.2, meaning that its stock price is 80% less volatile than the S&P 500. Comparatively, TriplePoint Venture Growth BDC has a beta of 1.31, meaning that its stock price is 31% more volatile than the S&P 500.

Dividends

StoneCastle Financial pays an annual dividend of $1.52 per share and has a dividend yield of 7.4%. TriplePoint Venture Growth BDC pays an annual dividend of $1.44 per share and has a dividend yield of 11.0%. StoneCastle Financial pays out 86.4% 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 102.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

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

Net Margins Return on Equity Return on Assets
StoneCastle Financial 66.86% N/A N/A
TriplePoint Venture Growth BDC 43.72% 12.05% 5.99%

Analyst Recommendations

This is a summary of current recommendations and price targets for StoneCastle Financial and TriplePoint Venture Growth BDC, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
StoneCastle Financial 0 0 4 0 3.00
TriplePoint Venture Growth BDC 0 1 1 0 2.50

StoneCastle Financial currently has a consensus price target of $22.75, indicating a potential upside of 10.71%. TriplePoint Venture Growth BDC has a consensus price target of $14.00, indicating a potential upside of 6.54%. Given StoneCastle Financial’s stronger consensus rating and higher probable upside, research analysts clearly believe StoneCastle Financial is more favorable than TriplePoint Venture Growth BDC.

Institutional and Insider Ownership

32.4% of StoneCastle Financial shares are owned by institutional investors. Comparatively, 33.8% of TriplePoint Venture Growth BDC shares are owned by institutional investors. 8.0% of StoneCastle Financial shares are owned by company insiders. Comparatively, 1.3% of TriplePoint Venture Growth BDC shares are owned by company 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.

Summary

StoneCastle Financial beats TriplePoint Venture Growth BDC on 9 of the 16 factors compared between the two stocks.

StoneCastle Financial Company Profile

StoneCastle Financial Corp. is a non-diversified, closed-end management investment company. The Company’s primary investment objective is to provide stockholders with current income, and to a lesser extent capital appreciation. The Company generally invests in the senior debt, subordinated debt, preferred shares and common stock of community banks. The Company’s investment portfolio includes term loans, debt securities, trust preferred securities, preferred shares of credit securitization, preferred securities, convertible preferred stock, common stock, exchange traded fund, limited partnership interest and money market fund. The Company invests in bank issuers of various locations, such as California, Colorado, Florida, Georgia, Illinois, Kansas, Maine, Maryland, New Jersey, New York, Ohio, North Carolina, Oklahoma, South Carolina, Texas and West Virginia.

TriplePoint Venture Growth BDC Company Profile

TriplePoint Venture Growth BDC Corp. is a closed-end, non-diversified management investment company. The Company’s investment objective is to maximize its total return to stockholders primarily in the form of current income and, to a lesser extent, capital appreciation by primarily lending with warrants to venture growth stage companies focused in technology, life sciences and other high growth industries, which are backed by TriplePoint Capital LLC’s (TPC) select group of venture capital investors. The Company targets investment opportunities in venture growth stage companies backed by venture capital investors. The Company originates and invests primarily in loans that have a secured collateral position and are used by venture growth stage companies to finance their continued expansion and growth, equipment financings and, on a select basis, revolving loans. The Company is managed by TPVG Advisers LLC.

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