Adams Diversified Equity Fund (NYSE:ADX) and Apollo Investment (NASDAQ:AINV) Head-To-Head Review

Adams Diversified Equity Fund (NYSE:ADXGet Rating) and Apollo Investment (NASDAQ:AINVGet Rating) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, dividends, valuation and risk.

Risk & Volatility

Adams Diversified Equity Fund has a beta of 1.03, indicating that its share price is 3% more volatile than the S&P 500. Comparatively, Apollo Investment has a beta of 1.82, indicating that its share price is 82% more volatile than the S&P 500.

Earnings and Valuation

This table compares Adams Diversified Equity Fund and Apollo Investment’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Adams Diversified Equity Fund N/A N/A N/A N/A N/A
Apollo Investment $216.75 million 3.91 $111.86 million $1.85 7.19

Apollo Investment has higher revenue and earnings than Adams Diversified Equity Fund.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Adams Diversified Equity Fund and Apollo Investment, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Adams Diversified Equity Fund 0 0 0 0 N/A
Apollo Investment 0 2 1 0 2.33

Apollo Investment has a consensus target price of $13.38, suggesting a potential upside of 0.56%. Given Apollo Investment’s higher possible upside, analysts clearly believe Apollo Investment is more favorable than Adams Diversified Equity Fund.

Profitability

This table compares Adams Diversified Equity Fund and Apollo Investment’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Adams Diversified Equity Fund N/A N/A N/A
Apollo Investment 57.61% 9.14% 3.61%

Institutional and Insider Ownership

16.0% of Adams Diversified Equity Fund shares are owned by institutional investors. Comparatively, 35.2% of Apollo Investment shares are owned by institutional investors. 0.2% of Adams Diversified Equity Fund shares are owned by company insiders. Comparatively, 0.6% of Apollo Investment 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.

Dividends

Adams Diversified Equity Fund pays an annual dividend of $2.98 per share and has a dividend yield of 16.6%. Apollo Investment pays an annual dividend of $1.24 per share and has a dividend yield of 9.3%. Apollo Investment pays out 67.0% of its earnings in the form of a dividend. Apollo Investment has raised its dividend for 1 consecutive years.

Summary

Apollo Investment beats Adams Diversified Equity Fund on 10 of the 12 factors compared between the two stocks.

About Adams Diversified Equity Fund (Get Rating)

The Adams Express Company (the Fund) is a diversified investment company. The Company is an internally-managed closed-end fund whose investment objectives are preservation of capital, the attainment of reasonable income from investments, and an opportunity for capital appreciation. In order to conduct the Company’s business, the Company, through its transfer agent, American Stock Transfer & Trust Company, collects and maintains certain non-public personal information about its stockholders of record with respect to their transactions in shares of its securities. The Company’s investments include common stocks and short-term investments.

About Apollo Investment (Get Rating)

Apollo Investment Corporation is a closed-end, externally managed, non-diversified management investment company that has elected to be treated as a business development company (ÂBDCÂ) under the Investment Company Act of 1940 (the Â1940 ActÂ) specializing in private equity investments in leveraged buyouts, acquisitions, recapitalizations, growth capital, refinancing and private middle market companies. It provides direct equity capital, mezzanine, first lien secured loans, stretch senior loans, unitranche loans, second lien secured loans and senior secured loans, unsecured debt, and subordinated debt and loans. It also seeks to invest in PIPES transactions. The fund may also invest in securities of public companies that are thinly traded and may acquire investments in the secondary market and structured products. It prefers to invest in preferred equity, common equity / interests and warrants and makes equity co-investments and may also invest in cash equivalents, U.S. government securities, high-quality debt investments that mature in one year or less, high-yield bonds, distressed debt, non-U.S. investments, or securities of public companies that are not thinly traded. It also focuses on other investments such as collateralized loan obligations (ÂCLOsÂ) and credit-linked notes (ÂCLNsÂ). The fund typically invests in construction and building materials, business services, plastics & rubber, advertising, capital equipment, education, cable television, chemicals, consumer products/goods durable and non-durable and customer services, direct marketing, energy Â- oil & gas, electricity and utilities, aerospace & defense, wholesale, telecommunications, financial services, hotel, gaming, leisure, restaurants; environmental industries, healthcare and pharmaceuticals, high tech industries, beverages, food and tobacco, manufacturing, media Â- diversified & production, printing and publishing, retail, automation, aviation and consumer transport, transportation, cargo and distribution. It primarily invests in United States. It primarily invests between $20 million and $250 million in its portfolio companies. The fund seeks to make investments with stated maturities of five to 10 years.

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