Nuveen Churchill Direct Lending (NYSE:NCDL) vs. Trinity Capital (NASDAQ:TRIN) Head to Head Review

Trinity Capital (NASDAQ:TRIN) and Nuveen Churchill Direct Lending (NYSE:NCDL) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, analyst recommendations, dividends, institutional ownership, earnings, risk and valuation.

Dividends

Trinity Capital pays an annual dividend of $2.04 per share and has a dividend yield of 13.7%. Nuveen Churchill Direct Lending pays an annual dividend of $1.80 per share and has a dividend yield of 13.5%. Trinity Capital pays out 104.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Nuveen Churchill Direct Lending pays out 137.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Trinity Capital has increased its dividend for 1 consecutive years. Trinity Capital is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Trinity Capital has a beta of 0.55, suggesting that its stock price is 45% less volatile than the S&P 500. Comparatively, Nuveen Churchill Direct Lending has a beta of 0.44, suggesting that its stock price is 56% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings for Trinity Capital and Nuveen Churchill Direct Lending, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Trinity Capital	1	1	5	1	2.75
Nuveen Churchill Direct Lending	0	4	2	0	2.33

Trinity Capital currently has a consensus target price of $16.29, indicating a potential upside of 9.37%. Nuveen Churchill Direct Lending has a consensus target price of $15.40, indicating a potential upside of 15.22%. Given Nuveen Churchill Direct Lending’s higher possible upside, analysts clearly believe Nuveen Churchill Direct Lending is more favorable than Trinity Capital.

Insider and Institutional Ownership

24.6% of Trinity Capital shares are owned by institutional investors. 6.4% of Trinity Capital shares are owned by insiders. Comparatively, 0.6% of Nuveen Churchill Direct Lending 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.

Valuation and Earnings

This table compares Trinity Capital and Nuveen Churchill Direct Lending”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Trinity Capital	$293.65 million	4.22	$135.60 million	$1.96	7.60
Nuveen Churchill Direct Lending	$207.86 million	3.18	$65.61 million	$1.31	10.20

Trinity Capital has higher revenue and earnings than Nuveen Churchill Direct Lending. Trinity Capital is trading at a lower price-to-earnings ratio than Nuveen Churchill Direct Lending, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Trinity Capital and Nuveen Churchill Direct Lending’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Trinity Capital	46.18%	14.97%	6.68%
Nuveen Churchill Direct Lending	31.57%	10.48%	4.47%

Summary

Trinity Capital beats Nuveen Churchill Direct Lending on 16 of the 18 factors compared between the two stocks.

About Trinity Capital

Trinity Capital Inc. is a business development company. It is a venture capital firm specializing in venture debt to growth stage companies looking for loans and/or equipment financing. Trinity Capital Inc. was founded in 2019 is based in Phoenix, Arizona with additional offices in the United States.

About Nuveen Churchill Direct Lending

Nuveen Churchill Direct Lending Corp. is a specialty finance company focused primarily on investing in senior secured loans to private equity-owned U.S. middle market companies. It has elected to be regulated as a business development company. Nuveen Churchill Direct Lending Corp. is based in NEW YORK.