Analyzing ONEX (OTCMKTS:ONEXF) and OFS Credit (NASDAQ:OCCI)

ONEX (OTCMKTS:ONEXF) and OFS Credit (NASDAQ:OCCI) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, analyst recommendations, institutional ownership, risk, profitability, earnings and valuation.

Analyst Recommendations

This is a summary of current ratings and recommmendations for ONEX and OFS Credit, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ONEX	0	1	2	0	2.67
OFS Credit	0	0	0	0	0.00

Risk and Volatility

ONEX has a beta of 1.34, suggesting that its stock price is 34% more volatile than the S&P 500. Comparatively, OFS Credit has a beta of 0.65, suggesting that its stock price is 35% less volatile than the S&P 500.

Institutional and Insider Ownership

0.7% of ONEX shares are owned by institutional investors. Comparatively, 23.8% of OFS Credit shares are owned by institutional investors. 1.0% of OFS Credit 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.

Dividends

ONEX pays an annual dividend of $0.29 per share and has a dividend yield of 0.4%. OFS Credit pays an annual dividend of $1.38 per share and has a dividend yield of 28.3%. ONEX pays out 4.0% of its earnings in the form of a dividend. OFS Credit pays out 575.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares ONEX and OFS Credit’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ONEX	61.92%	6.12%	3.85%
OFS Credit	N/A	N/A	N/A

Valuation and Earnings

This table compares ONEX and OFS Credit”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ONEX	$649.00 million	8.74	$303.00 million	$7.32	11.29
OFS Credit	$32.55 million	2.36	$3.78 million	$0.24	20.33

ONEX has higher revenue and earnings than OFS Credit. ONEX is trading at a lower price-to-earnings ratio than OFS Credit, indicating that it is currently the more affordable of the two stocks.

Summary

ONEX beats OFS Credit on 11 of the 15 factors compared between the two stocks.

About ONEX

Onex Corporation is a private equity firm specializing in acquisitions and platform acquisitions. The firm makes investments in buyouts, large- middle market, large-cap, mid-cap, and small-cap market and distressed companies. It also invests in recapitalization, growth capital, corporate carve-outs of subsidiaries and mission-critical supply divisions from multinational corporations, operational restructurings of undervalued businesses, and builds up. The firm seeks to invest in technology, electronics manufacturing services, industrial, aerospace, healthcare, retail, restaurants, industrials products, customer care services, metal services, building products, entertainment, gaming, cabinetry products, commercial vehicles, commercial and investment banking, financial services, commercial and multi-unit residential real estate. It invests in global businesses headquartered in North America, including United States and Canada, or Europe. The firm seeks to invest between $125 million and $1 billion in companies that have minimum revenues of $300 million. It does not consider size if the company is in an industry in which the firm already has presence. The firm seeks to make direct as well as co-investments through managed private equity, real estate and credit funds. It seeks to acquire a control position in its portfolio companies. Onex Corporation was founded in 1984 and is based in Toronto, Canada with additional offices in New York, New York; Englewood Cliffs, New Jersey; Boston, Massachusetts and London, United Kingdom.

About OFS Credit

OFS Credit Company, Inc. is a fund of OFS Advisor.