Capitala Finance (CPTA) vs. Firsthand Technology Value Fund (SVVC) Financial Analysis

Capitala Finance (NASDAQ:CPTA) and Firsthand Technology Value Fund (NASDAQ:SVVC) are both small-cap finance companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, profitability, earnings, dividends, valuation, risk and analyst recommendations.

Dividends

Capitala Finance pays an annual dividend of $1.00 per share and has a dividend yield of 13.1%. Firsthand Technology Value Fund does not pay a dividend. Capitala Finance pays out 102.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Earnings and Valuation

This table compares Capitala Finance and Firsthand Technology Value Fund’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Capitala Finance $51.09 million 2.40 -$6.98 million $0.98 7.80
Firsthand Technology Value Fund $1.57 million 60.46 $26.17 million N/A N/A

Firsthand Technology Value Fund has lower revenue, but higher earnings than Capitala Finance.

Insider & Institutional Ownership

17.7% of Capitala Finance shares are held by institutional investors. Comparatively, 4.4% of Firsthand Technology Value Fund shares are held by institutional investors. 9.1% of Capitala Finance shares are held by company insiders. Comparatively, 3.6% of Firsthand Technology Value Fund shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Capitala Finance and Firsthand Technology Value Fund’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Capitala Finance -16.14% 7.76% 3.20%
Firsthand Technology Value Fund 2,592.77% -9.75% -9.08%

Analyst Ratings

This is a summary of recent ratings and price targets for Capitala Finance and Firsthand Technology Value Fund, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Capitala Finance 0 1 1 0 2.50
Firsthand Technology Value Fund 0 0 0 0 N/A

Capitala Finance presently has a consensus target price of $9.00, suggesting a potential upside of 17.80%. Given Capitala Finance’s higher possible upside, equities research analysts clearly believe Capitala Finance is more favorable than Firsthand Technology Value Fund.

Volatility & Risk

Capitala Finance has a beta of 0.96, suggesting that its share price is 4% less volatile than the S&P 500. Comparatively, Firsthand Technology Value Fund has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500.

Summary

Capitala Finance beats Firsthand Technology Value Fund on 8 of the 13 factors compared between the two stocks.

About Capitala Finance

Capitala Finance Corp. is a Business Development Company specializing in traditional mezzanine, senior subordinated and unitranche debt, first-lien and second-lien loans, equity investments in sponsored and non-sponsored lower and traditional middle market companies. The fund targets companies in the business services, commercial and professional services, manufacturing, consumer and retail, energy, and health-care industries. It typically considers investments in the United States. The fund invests $5 million and $50 million per transaction in companies with greater than $4.5 million of TTM EBITDA. It may also invest in senior secured positions in "stretch" senior secured loans. The fund makes minority equity co-investments, alongside management or financial sponsors.

About Firsthand Technology Value Fund

Firsthand Technology Value Fund, Inc. is a publicly traded ventures capital fund invests in companies located in the US. The fund target companies operating in the fields of game changing technology and cleantech services. It provides financing in the form of equity and debt for early, growth and later stage capital requirements with an investment size ranges between $1 and $10 million.

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