Analyzing Crescent Capital BDC (NASDAQ:CCAP) and Golub Capital BDC (NASDAQ:GBDC)

Crescent Capital BDC (NASDAQ:CCAP) and Golub Capital BDC (NASDAQ:GBDC) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, earnings, valuation, profitability, dividends, risk and analyst recommendations.

Profitability

This table compares Crescent Capital BDC and Golub Capital BDC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Crescent Capital BDC	24.12%	10.55%	4.68%
Golub Capital BDC	42.81%	10.87%	4.87%

Insider & Institutional Ownership

49.5% of Crescent Capital BDC shares are held by institutional investors. Comparatively, 42.4% of Golub Capital BDC shares are held by institutional investors. 1.1% of Crescent Capital BDC shares are held by insiders. Comparatively, 3.6% of Golub Capital BDC shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Dividends

Crescent Capital BDC pays an annual dividend of $1.68 per share and has a dividend yield of 11.8%. Golub Capital BDC pays an annual dividend of $1.56 per share and has a dividend yield of 11.0%. Crescent Capital BDC pays out 140.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Golub Capital BDC pays out 109.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Crescent Capital BDC has increased its dividend for 1 consecutive years. Crescent Capital BDC is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Crescent Capital BDC and Golub Capital BDC”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Crescent Capital BDC	$197.36 million	N/A	$73.65 million	$1.20	11.90
Golub Capital BDC	$724.68 million	5.19	$273.79 million	$1.42	9.94

Golub Capital BDC has higher revenue and earnings than Crescent Capital BDC. Golub Capital BDC is trading at a lower price-to-earnings ratio than Crescent Capital BDC, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Crescent Capital BDC and Golub Capital BDC, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Crescent Capital BDC	1	1	1	1	2.50
Golub Capital BDC	0	2	2	0	2.50

Crescent Capital BDC presently has a consensus price target of $16.33, indicating a potential upside of 14.38%. Golub Capital BDC has a consensus price target of $15.00, indicating a potential upside of 6.23%. Given Crescent Capital BDC’s higher possible upside, analysts clearly believe Crescent Capital BDC is more favorable than Golub Capital BDC.

Volatility & Risk

Crescent Capital BDC has a beta of 0.57, suggesting that its share price is 43% less volatile than the S&P 500. Comparatively, Golub Capital BDC has a beta of 0.47, suggesting that its share price is 53% less volatile than the S&P 500.

Summary

Golub Capital BDC beats Crescent Capital BDC on 9 of the 16 factors compared between the two stocks.

About Crescent Capital BDC

Crescent Capital BDC, Inc. is as a business development company private equity / buyouts and loan fund. It specializes in directly investing. It specializes in middle market. The fund seeks to invest in United States.

About Golub Capital BDC

Golub Capital BDC, Inc. (GBDC) is a business development company and operates as an externally managed closed-end non-diversified management investment company. It invests in debt and minority equity investments in middle-market companies that are, in most cases, sponsored by private equity investors. It typically invests in diversified consumer services, automobiles, healthcare technology, insurance, health care equipment and supplies, hotels, restaurants and leisure, healthcare providers and services, IT services and specialty retails. It seeks to invest in the United States. It primarily invests in first lien traditional senior debt, first lien one stop, junior debt and equity, senior secured, one stop, unitranche, second lien, subordinated and mezzanine loans of middle-market companies, and warrants.