Head to Head Contrast: FS Investment Corporation (FSIC) vs. Invesco California Value Municipal Income Trust (VCV)

FS Investment Corporation (NYSE: FSIC) and Invesco California Value Municipal Income Trust (NYSE:VCV) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, dividends, risk, profitability, institutional ownership, valuation and analyst recommendations.

Valuation & Earnings

This table compares FS Investment Corporation and Invesco California Value Municipal Income Trust’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
FS Investment Corporation $422.81 million 4.77 $294.29 million $0.90 9.11
Invesco California Value Municipal Income Trust N/A N/A N/A N/A N/A

FS Investment Corporation has higher revenue and earnings than Invesco California Value Municipal Income Trust.

Profitability

This table compares FS Investment Corporation and Invesco California Value Municipal Income Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
FS Investment Corporation 52.49% 8.99% 4.95%
Invesco California Value Municipal Income Trust N/A N/A N/A

Dividends

FS Investment Corporation pays an annual dividend of $0.89 per share and has a dividend yield of 10.9%. Invesco California Value Municipal Income Trust pays an annual dividend of $0.59 per share and has a dividend yield of 4.6%. FS Investment Corporation pays out 98.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Institutional and Insider Ownership

32.4% of FS Investment Corporation shares are held by institutional investors. Comparatively, 8.4% of Invesco California Value Municipal Income Trust shares are held by institutional investors. 1.0% of FS Investment Corporation shares are held by company insiders. Comparatively, 1.0% of Invesco California Value Municipal Income Trust shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and target prices for FS Investment Corporation and Invesco California Value Municipal Income Trust, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
FS Investment Corporation 0 4 0 0 2.00
Invesco California Value Municipal Income Trust 0 0 0 0 N/A

FS Investment Corporation presently has a consensus target price of $9.67, suggesting a potential upside of 17.89%. Given FS Investment Corporation’s higher probable upside, equities analysts clearly believe FS Investment Corporation is more favorable than Invesco California Value Municipal Income Trust.

Volatility & Risk

FS Investment Corporation has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500. Comparatively, Invesco California Value Municipal Income Trust has a beta of -0.12, meaning that its share price is 112% less volatile than the S&P 500.

Summary

FS Investment Corporation beats Invesco California Value Municipal Income Trust on 8 of the 9 factors compared between the two stocks.

FS Investment Corporation Company Profile

FS Investment Corporation is an externally managed, non-diversified, closed-end management investment company. The Company’s investment objectives are to generate current income and long-term capital appreciation. Its portfolio consists primarily of investments in senior secured loans and second lien secured loans of the private United States middle market companies and subordinated loans of the private United States companies. It may purchase interests in loans or make other debt investments, including investments in senior secured bonds, through secondary market transactions in the over-the-counter market or directly from target companies as primary market or directly originated investments. It invests in a range of industries, including capital goods; consumer services; consumer durables and apparel; materials; commercial and professional services, and diversified financials. Its investment advisor is FB Income Advisor, LLC.

Invesco California Value Municipal Income Trust Company Profile

Invesco Van Kampen California Value Municipal Income Trust (the Trust), formerly Invesco California Value Municipal Income Trust, is a diversified, closed-end management investment trust. The Trust’s investment objective is to seek to provide common shareholders with a high level of current income exempt from federal and California income taxes, consistent with preservation of capital. The Trust will invest substantially all of its assets in California municipal securities rated investment grade at the time of investment. The Trust seeks to achieve its investment objective by investing primarily in California municipal securities that are rated investment grade at the time of investment. Municipal securities include municipal bonds, municipal notes, municipal commercial paper and lease obligations. Invesco Advisers, Inc. serves as its investment advisor.

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