Noah (NYSE: NOAH) and Saratoga Investment (NYSE:SAR) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, valuation, earnings, risk, dividends, analyst recommendations and profitability.
Saratoga Investment pays an annual dividend of $2.00 per share and has a dividend yield of 9.8%. Noah does not pay a dividend. Saratoga Investment pays out 119.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Saratoga Investment has raised its dividend for 2 consecutive years.
46.9% of Noah shares are held by institutional investors. Comparatively, 17.4% of Saratoga Investment shares are held by institutional investors. 32.0% of Saratoga Investment shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Valuation and Earnings
This table compares Noah and Saratoga Investment’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Noah||$434.49 million||6.51||$118.37 million||$2.01||24.87|
|Saratoga Investment||$33.16 million||3.85||$11.38 million||$1.68||12.14|
Noah has higher revenue and earnings than Saratoga Investment. Saratoga Investment is trading at a lower price-to-earnings ratio than Noah, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent recommendations for Noah and Saratoga Investment, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Noah currently has a consensus target price of $58.00, suggesting a potential upside of 16.02%. Saratoga Investment has a consensus target price of $23.83, suggesting a potential upside of 16.83%. Given Saratoga Investment’s higher probable upside, analysts clearly believe Saratoga Investment is more favorable than Noah.
This table compares Noah and Saratoga Investment’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Volatility & Risk
Noah has a beta of 2.57, meaning that its stock price is 157% more volatile than the S&P 500. Comparatively, Saratoga Investment has a beta of 0.2, meaning that its stock price is 80% less volatile than the S&P 500.
Noah beats Saratoga Investment on 11 of the 17 factors compared between the two stocks.
Noah Company Profile
Noah Holdings Limited is a wealth management service provider with a focus on global wealth investment and asset allocation services for high net worth individuals and enterprises in China. The Company operates through three segments: wealth management, asset management and Internet finance. It also provides Internet finance services to clients in China. It provides direct access to China’s high net worth population. With approximately 1,100 relationship managers in over 130 branch offices, its coverage network includes China’s regions where high net worth population is concentrated, including the Yangtze River Delta, the Pearl River Delta, the Bohai Rim and other regions. Its product offerings consist primarily of over-the-counter (OTC) wealth management and OTC asset management products, mutual fund products and asset management plans originated in China and designed to cater to the needs of China’s high net worth population.
Saratoga Investment Company Profile
Saratoga Investment Corp. is a business development company specializing in leveraged and management buyouts, acquisition financings, growth financings, recapitalization, debt refinancing, and transitional financing transactions at the lower end of middle market companies. It structures its investments as debt and equity by investing through first and second lien loans, mezzanine debt, co-investments, select high yield bonds, senior secured bonds, unsecured bonds, and preferred and common equity. It seeks to invest in the United States. The firm primarily invests $5 million to $20 million in companies having EBITDA of $2 million or greater and revenues of $8 million to $150 million. It invests through direct lending as well as participation in loan syndicates. The firm was formerly known as GSC Investment Corp. Saratoga Investment Corp. is based in New York, New York with an additional office in Florham Park, New Jersey.
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