PennantPark Investment (NASDAQ:PNNT – Get Free Report) and Binah Capital Group (NASDAQ:BCG – Get Free Report) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, institutional ownership, risk and dividends.
Institutional & Insider Ownership
26.6% of PennantPark Investment shares are owned by institutional investors. Comparatively, 5.0% of Binah Capital Group shares are owned by institutional investors. 3.0% of PennantPark Investment shares are owned by insiders. Comparatively, 7.8% of Binah Capital Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Analyst Recommendations
This is a summary of recent recommendations and price targets for PennantPark Investment and Binah Capital Group, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| PennantPark Investment | 1 | 3 | 1 | 0 | 2.00 |
| Binah Capital Group | 1 | 0 | 0 | 0 | 1.00 |
Valuation & Earnings
This table compares PennantPark Investment and Binah Capital Group”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| PennantPark Investment | $21.50 million | 9.97 | $48.85 million | $0.16 | 20.53 |
| Binah Capital Group | $185.84 million | 0.10 | $2.31 million | $0.18 | 6.22 |
PennantPark Investment has higher earnings, but lower revenue than Binah Capital Group. Binah Capital Group is trading at a lower price-to-earnings ratio than PennantPark Investment, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
PennantPark Investment has a beta of 0.61, indicating that its share price is 39% less volatile than the S&P 500. Comparatively, Binah Capital Group has a beta of 0.27, indicating that its share price is 73% less volatile than the S&P 500.
Profitability
This table compares PennantPark Investment and Binah Capital Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| PennantPark Investment | 11.33% | 11.59% | 4.23% |
| Binah Capital Group | 2.17% | 195.38% | 5.95% |
Summary
PennantPark Investment beats Binah Capital Group on 9 of the 14 factors compared between the two stocks.
About PennantPark Investment
PennantPark Investment Corporation, a business development company is a private equity fund specializes in direct and mezzanine investments in middle market companies. It invests in the form of mezzanine debt, senior secured loans, and equity investments. The fund typically invests in buildings and real estate, hotels, gaming and leisure, technology, telecommunications, transportation, information technology services, electronics, healthcare & pharmaceuticals, education and childcare, financial services, printing and publishing, consumer products, business services, energy & Related Services and utilities, distribution, oil and gas, media, environmental services, aerospace and defense, building materials, capital equipment, chemicals, plastics, & rubber, food & beverage, wholesale, manufacturing and basic industries and retail. It invests in equity securities and debt transactions through preferred stock, common stock, warrants, options, senior secured debt, subordinated debt, subordinated loans, first lien debt, mezzanine loans, and distressed debt securities and private equity co-investments. It seeks to invest in companies based in the United States. The fund seeks to invest between $10 million and $100 million cross the capital structure (senior secured loans, subordinated debt, and other investments) in its portfolio companies with EBITDA between $10 to $50 million. Its mezzanine loans, senior secured loans, and other investments in its portfolio companies are between $15 million and $50 million. The fund may also make non-control equity and debt investments.
About Binah Capital Group
Binah Capital Group, Inc., together with its subsidiaries, operates in the wealth management industry. The company provides access to stock, bond, exchange-traded fund, and options execution services; and research, compliance, supervision, and accounting and related services for financial advisors. It also offers mutual funds and insurance products, as well as alternative investments, such as non-traded real estate investment trusts, unit trusts, and fixed and variable annuities. The company was founded in 2016 and is headquartered in Albany, New York. Binah Capital Group, Inc. operates as a subsidiary of MHC Securities, LLC.
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