Medley Capital (NYSE:MCC) and IGM Financial (OTCMKTS:IGIFF) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their dividends, risk, earnings, institutional ownership, profitability, valuation and analyst recommendations.
Earnings and Valuation
This table compares Medley Capital and IGM Financial’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Medley Capital||$96.26 million||2.19||-$15.07 million||$0.67||5.78|
Medley Capital pays an annual dividend of $0.40 per share and has a dividend yield of 10.3%. IGM Financial does not pay a dividend. Medley Capital pays out 59.7% of its earnings in the form of a dividend.
Institutional and Insider Ownership
25.4% of Medley Capital shares are held by institutional investors. 15.0% of Medley Capital shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
This table compares Medley Capital and IGM Financial’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent ratings and recommmendations for Medley Capital and IGM Financial, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Medley Capital currently has a consensus price target of $4.67, indicating a potential upside of 20.59%. Given Medley Capital’s higher probable upside, research analysts clearly believe Medley Capital is more favorable than IGM Financial.
Volatility and Risk
Medley Capital has a beta of 1.13, indicating that its share price is 13% more volatile than the S&P 500. Comparatively, IGM Financial has a beta of 1.46, indicating that its share price is 46% more volatile than the S&P 500.
Medley Capital beats IGM Financial on 7 of the 12 factors compared between the two stocks.
About Medley Capital
Medley Capital Corporation is a business development company. The fund seeks to invest in privately negotiated debt and equity securities of small and middle market companies. It primarily invests in the following sectors: business services; buildings and real estate; automobile; oil and gas; aerospace and defense; home and office furnishings, housewares, and durable consumer products; healthcare, education and childcare; personal, food, and miscellaneous services; retail stores, diversified or conglomerate manufacturing; telecommunications; mining, steel, iron, and non-precious metals; leisure, amusement, motion pictures, and entertainment; chemicals, plastics, and rubber; finance; personal and nondurable consumer products (manufacturing only); beverage, food, and tobacco; containers, packaging, and glass; structure finance securities; machinery (non-agriculture, non-construction, non-electric); diversified or conglomerate service; restaurant and franchise; electronics; and cargo transport. The fund seeks to invest in companies located in North America. The fund targets private debt transactions in companies with enterprise values or asset values between $25 million and $250 million. The fund seeks to invest in companies with debt investment values between $10 million and $50 million. It exits its investments between three years and seven years; it holds most of its investments to maturity or repayment, but may realize or sell some investments earlier. The fund may take a board seat on its investee companies and can also offer managerial assistance to certain portfolio companies. It structures its investments as first lien senior secured loans, second lien senior secured loans, senior secured notes, senior subordinated notes, subordinate notes, unitranche loans, and seeks warrants or other equity participation. The fund may co-invest in privately negotiated transactions under certain conditions.
About IGM Financial
IGM Financial Inc. manages and distributes investment funds and other managed asset products in Canada. The company operates through Investors Group, Mackenzie Investments, and Corporate and Other segments. The company also offers financial planning services, including investment, tax, retirement, education, risk management, and estate planning; strategic investment planning programs; mutual funds; managed asset and multi-manager investment programs; iProfile, a portfolio management program; and separately managed accounts and fee-based brokerage accounts. In addition, it provides segregated funds; term, universal life, whole life, disability, critical illness, long-term care, and personal health care coverage and group insurance products; securities services; and residential mortgages. Further, the company offers banking products, such as investment loans, lines of credit, personal loans, creditor insurance, deposit accounts, and credit cards; cash management solutions; guaranteed investment certificates; private wealth solutions; and investment management, advisory, and related services. It offers its products and services through a network of consultants, as well as retail, strategic alliance, and institutional distribution channels. The company was founded in 1894 and is headquartered in Winnipeg, Canada. IGM Financial Inc. is a subsidiary of Power Financial Corporation.
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