OFS Capital (NASDAQ: OFS) and Kayne Anderson Energy Development (NYSE:KED) are both small-cap financials companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, institutional ownership, risk, valuation, dividends, earnings and analyst recommendations.
OFS Capital pays an annual dividend of $1.36 per share and has a dividend yield of 11.2%. Kayne Anderson Energy Development pays an annual dividend of $1.60 per share and has a dividend yield of 9.0%. OFS Capital pays out 149.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Kayne Anderson Energy Development pays out -2,285.7% of its earnings in the form of a dividend.
28.1% of OFS Capital shares are owned by institutional investors. 0.0% of OFS Capital shares are owned by 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.
Valuation and Earnings
This table compares OFS Capital and Kayne Anderson Energy Development’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|OFS Capital||$31.09 million||5.22||$13.82 million||$0.91||13.36|
|Kayne Anderson Energy Development||N/A||N/A||N/A||($0.07)||-255.00|
OFS Capital has higher revenue and earnings than Kayne Anderson Energy Development. Kayne Anderson Energy Development is trading at a lower price-to-earnings ratio than OFS Capital, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations and price targets for OFS Capital and Kayne Anderson Energy Development, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Kayne Anderson Energy Development||0||0||1||0||3.00|
OFS Capital presently has a consensus price target of $14.67, indicating a potential upside of 20.61%. Kayne Anderson Energy Development has a consensus price target of $20.00, indicating a potential upside of 12.04%. Given OFS Capital’s higher probable upside, equities research analysts clearly believe OFS Capital is more favorable than Kayne Anderson Energy Development.
This table compares OFS Capital and Kayne Anderson Energy Development’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Kayne Anderson Energy Development||-2,475.00%||-13.79%||-8.15%|
Risk & Volatility
OFS Capital has a beta of 0.48, indicating that its share price is 52% less volatile than the S&P 500. Comparatively, Kayne Anderson Energy Development has a beta of 1.27, indicating that its share price is 27% more volatile than the S&P 500.
OFS Capital beats Kayne Anderson Energy Development on 11 of the 14 factors compared between the two stocks.
OFS Capital Company Profile
OFS Capital Corporation (OFS Capital) is an externally managed, closed-end, non-diversified management investment company. The Company’s investment objective is to provide its shareholders with both current income and capital appreciation primarily through debt investments and equity investments. It focuses primarily on middle-market companies in the United States, including senior secured loans, including first-lien, second-lien and unitranche loans, as well as subordinated loans, and warrants and other minority equity securities. The Company may make investments directly or through OFS SBIC I, LP (SBIC I LP), its investment company subsidiary. It focuses on investments in loans, in which OFS Advisor’s investment professionals have expertise, including investments in first-lien, unitranche, second-lien, and mezzanine loans and, to a lesser extent, on warrants and other equity securities. The Company’s investment activities are managed by OFS Capital Management, LLC (OFS Advisor).
Kayne Anderson Energy Development Company Profile
Kayne Anderson Energy Development Company is a non-diversified, closed-end fund. The Fund’s investment objective is to generate both current income and capital appreciation, through equity and debt investments. It seeks to achieve this objective by investing approximately 80% of its total assets in securities of companies that derive their revenue from activities in the energy industry, including midstream energy companies, which operates assets used to gather, transport, process, treat, terminal and store natural gas, natural gas liquids, crude oil or refined petroleum products; upstream energy companies, which are engaged in the exploration, extraction and production of natural resources, including natural gas, natural gas liquids and crude oil, from onshore and offshore geological reservoirs, and other energy companies, which are engaged in owning, leasing, managing, producing, processing and selling of coal and coal reserves. KA Fund Advisors, LLC is the advisor of the Fund.
Receive News & Ratings for OFS Capital Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for OFS Capital and related companies with MarketBeat.com's FREE daily email newsletter.