Equus Total Return (NYSE:EQS) and Solar Senior Capital (NASDAQ:SUNS) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, dividends, risk, profitability, analyst recommendations and institutional ownership.
Risk & Volatility
Equus Total Return has a beta of 0.08, meaning that its stock price is 92% less volatile than the S&P 500. Comparatively, Solar Senior Capital has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500.
This table compares Equus Total Return and Solar Senior Capital’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Equus Total Return||589.23%||-7.53%||-4.76%|
|Solar Senior Capital||35.72%||8.59%||3.98%|
Insider & Institutional Ownership
12.9% of Equus Total Return shares are owned by institutional investors. Comparatively, 19.3% of Solar Senior Capital shares are owned by institutional investors. 6.7% of Equus Total Return shares are owned by company insiders. Comparatively, 5.7% of Solar Senior Capital shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Solar Senior Capital pays an annual dividend of $1.41 per share and has a dividend yield of 7.8%. Equus Total Return does not pay a dividend. Solar Senior Capital pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
This is a summary of recent recommendations and price targets for Equus Total Return and Solar Senior Capital, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Equus Total Return||0||0||0||0||N/A|
|Solar Senior Capital||0||0||1||0||3.00|
Solar Senior Capital has a consensus price target of $19.00, indicating a potential upside of 5.61%. Given Solar Senior Capital’s higher possible upside, analysts clearly believe Solar Senior Capital is more favorable than Equus Total Return.
Valuation & Earnings
This table compares Equus Total Return and Solar Senior Capital’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Equus Total Return||$480,000.00||44.50||$50,000.00||N/A||N/A|
|Solar Senior Capital||$39.81 million||7.25||$13.81 million||$1.41||12.76|
Solar Senior Capital has higher revenue and earnings than Equus Total Return.
Solar Senior Capital beats Equus Total Return on 9 of the 13 factors compared between the two stocks.
About Equus Total Return
Equus Total Return, Inc. is a business development company (BDC) specializing in leveraged buyouts, management buyouts, recapitalizations of existing businesses, special situations, equity and equity-oriented securities issued by privately owned companies, debt securities including subordinate debt, debt convertible into common or preferred stock, or debt combined with warrants and common and preferred stock, preferred equity financing, . The fund invests in small to mid sized companies and acts as a lead investor. It invests in companies engaged in the alternative energy, real estate, healthcare, education, e-learning, leisure and entertainment, and foreign investment sector in the United States, China, India, and Europe. The fund's investments include common and preferred stock, debt convertible into common or preferred stock, debt combined with warrants and options, and other rights to acquire common or preferred stock. The fund seeks to invest in companies with revenues between $10 million and $100 million.
About Solar Senior Capital
Solar Senior Capital Ltd. is a business development company specializing in investments in leveraged, middle-market companies in the United States. The fund invests in the form of senior secured loans, including first lien, unitranche, and second lien debt instruments. It does not invest in start-up companies or companies having speculative business plans. The fund prefers debt investments between $5 million and $30 million in companies with EBITDA between $20 million and $60 million.
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