Noah (NYSE:NOAH – Get Free Report) and Portman Ridge Finance (NASDAQ:PTMN – Get Free Report) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their risk, analyst recommendations, institutional ownership, earnings, valuation, dividends and profitability.
Analyst Recommendations
This is a breakdown of recent ratings and target prices for Noah and Portman Ridge Finance, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Noah | 1 | 2 | 1 | 0 | 2.00 |
| Portman Ridge Finance | 0 | 1 | 0 | 0 | 2.00 |
Noah presently has a consensus target price of $12.00, indicating a potential upside of 7.14%. Portman Ridge Finance has a consensus target price of $14.00, indicating a potential upside of 18.95%. Given Portman Ridge Finance’s higher probable upside, analysts plainly believe Portman Ridge Finance is more favorable than Noah.
Earnings & Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Noah | $2.58 billion | 0.29 | $65.14 million | $1.12 | 10.00 |
| Portman Ridge Finance | -$2.85 million | -54.58 | -$5.93 million | ($0.93) | -12.66 |
Noah has higher revenue and earnings than Portman Ridge Finance. Portman Ridge Finance is trading at a lower price-to-earnings ratio than Noah, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Noah has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500. Comparatively, Portman Ridge Finance has a beta of 0.6, suggesting that its share price is 40% less volatile than the S&P 500.
Insider & Institutional Ownership
42.7% of Noah shares are owned by institutional investors. Comparatively, 30.1% of Portman Ridge Finance shares are owned by institutional investors. 47.2% of Noah shares are owned by insiders. Comparatively, 2.1% of Portman Ridge Finance shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Profitability
This table compares Noah and Portman Ridge Finance’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Noah | 22.17% | 6.44% | 5.44% |
| Portman Ridge Finance | -15.92% | 11.49% | 4.54% |
Dividends
Noah pays an annual dividend of $0.55 per share and has a dividend yield of 4.9%. Portman Ridge Finance pays an annual dividend of $1.88 per share and has a dividend yield of 16.0%. Noah pays out 49.1% of its earnings in the form of a dividend. Portman Ridge Finance pays out -202.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Portman Ridge Finance is clearly the better dividend stock, given its higher yield and lower payout ratio.
Summary
Noah beats Portman Ridge Finance on 11 of the 15 factors compared between the two stocks.
About Noah
Noah Holdings Limited, together with its subsidiaries, operates as a wealth and asset management service provider with the focus on investment and asset allocation services for high net worth individuals and enterprises in Mainland of China, Hong Kong, and internationally. It operates through three segments: Wealth Management, Asset Management, and Other Services. The company offers investment products, including domestic and overseas mutual fund products, private secondary products, and other products; customized value-added financial services, such as investor education and trust services, as well as insurance brokerage services; and insurance products. It also provides onshore and offshore private equity, real estate, public securities, multi-strategy, and other investment products, as well as lending services. The company was founded in 2005 and is headquartered in Shanghai, the People's Republic of China.
About Portman Ridge Finance
Portman Ridge Finance Corporation is a business development company specializing in investments in unitranche loans (including last out), first lien loans, second lien loans, subordinated debt, equity co-investment, mezzanine, buyout in middle market companies. It also makes acquisitions in businesses complementary to the firm's business. It primarily invests in healthcare, cargo transport, manufacturing, industrial & environmental services, logistics & distribution, media & telecommunications, real estate, education, automotive, agriculture, aerospace/defense, packaging, electronics, finance, non-durable consumer, consumer products, business services, utilities, insurance, and food and beverage sectors. The fund typically invests $1 million to $20 million in its portfolio companies. It provides senior secured term loans from $2 million to $20 million maturing in five to seven years; second lien term loans from $5 million to $15 million maturing in six to eight years; senior unsecured loans $5 million to $23 million maturing in six to eight years; mezzanine loans from $5 million to $15 million maturing in seven to ten years; and equity investments from $1 to $5 million. The fund targets the companies with EBITDA between $5 million and $25 million. While investing in debt securities, it invests in those middle market firms with EBITDA between $10 million and $50 million and/or total debt between $25 million and $150 million. It invests in minority, and majority or control equity positions alongside its private equity sponsor partners.
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