Head-To-Head Comparison: Technology Investment Capital (OXSQ) and Horizon Technology Finance (HRZN)

Technology Investment Capital (NASDAQ: OXSQ) and Horizon Technology Finance (NASDAQ:HRZN) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their earnings, institutional ownership, dividends, profitability, analyst recommendations, risk and valuation.

Dividends

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Technology Investment Capital pays an annual dividend of $0.80 per share and has a dividend yield of 13.0%. Horizon Technology Finance pays an annual dividend of $1.20 per share and has a dividend yield of 11.5%. Technology Investment Capital pays out 133.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Horizon Technology Finance pays out 112.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Institutional and Insider Ownership

16.5% of Technology Investment Capital shares are owned by institutional investors. Comparatively, 17.4% of Horizon Technology Finance shares are owned by institutional investors. 5.9% of Technology Investment Capital shares are owned by insiders. Comparatively, 1.3% of Horizon Technology 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.

Earnings & Valuation

This table compares Technology Investment Capital and Horizon Technology Finance’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Technology Investment Capital $61.42 million 5.13 $43.60 million $0.60 10.25
Horizon Technology Finance $25.78 million 4.66 $9.59 million $1.07 9.74

Technology Investment Capital has higher revenue and earnings than Horizon Technology Finance. Horizon Technology Finance is trading at a lower price-to-earnings ratio than Technology Investment Capital, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Technology Investment Capital has a beta of 0.39, meaning that its stock price is 61% less volatile than the S&P 500. Comparatively, Horizon Technology Finance has a beta of 0.81, meaning that its stock price is 19% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Technology Investment Capital and Horizon Technology Finance, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Technology Investment Capital 2 0 1 0 1.67
Horizon Technology Finance 2 4 1 0 1.86

Technology Investment Capital presently has a consensus price target of $5.50, indicating a potential downside of 10.57%. Horizon Technology Finance has a consensus price target of $11.00, indicating a potential upside of 5.57%. Given Horizon Technology Finance’s stronger consensus rating and higher possible upside, analysts plainly believe Horizon Technology Finance is more favorable than Technology Investment Capital.

Profitability

This table compares Technology Investment Capital and Horizon Technology Finance’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Technology Investment Capital 71.02% 7.71% 5.36%
Horizon Technology Finance 37.21% 8.99% 5.68%

Summary

Horizon Technology Finance beats Technology Investment Capital on 8 of the 15 factors compared between the two stocks.

About Technology Investment Capital

TICC Capital Corp. is a business development company, operates as a closed-end, non-diversified management investment company. The firm invests in both public and private companies. It invests in secured and unsecured senior debt, subordinated debt, junior subordinated debt, preferred stock, and common stock. The firm primarily invests in debt and/or equity securities of technology-related companies that operate in the computer software, Internet, information technology infrastructure and services, media, telecommunications and telecommunications equipment, semiconductors, hardware, technology-enabled services, semiconductor capital equipment, medical device technology, diversified technology, and networking systems sectors. It concentrates its investments in companies having annual revenues of less than $200 million and a market capitalization or enterprise value of less than $300 million. The firm invests between $5 million and $30 million per transaction. It seeks to exit its investments within 7 years. It serves as the investment adviser to TICC. TICC Capital Corp., formerly known as Technology Investment Capital Corp., was founded in 2003 and is headquartered in Greenwich, Connecticut.

About Horizon Technology Finance

Horizon Technology Finance Corporation is a business development company specializing in lending and and investing in development-stage investments. It focuses on making secured debt and venture lending investments to venture capital backed companies in the technology, life science, healthcare information and services, and cleantech industries. It seeks to invest in companies in the United States.

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