Critical Survey: Neostellar Capital (NASDAQ:NSLR) versus Voya Financial (NYSE:VOYA)

Neostellar Capital (NASDAQ:NSLR) and Voya Financial (NYSE:VOYA) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, risk, institutional ownership, dividends, profitability, valuation and analyst recommendations.

Profitability

This table compares Neostellar Capital and Voya Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Neostellar Capital	6,053.56%	-12.63%	-10.14%
Voya Financial	7.75%	12.22%	0.45%

Valuation & Earnings

This table compares Neostellar Capital and Voya Financial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Neostellar Capital	$1.69 million	90.22	$48.81 million	$2.95	1.95
Voya Financial	$8.19 billion	1.10	$654.00 million	$6.22	15.92

Voya Financial has higher revenue and earnings than Neostellar Capital. Neostellar Capital is trading at a lower price-to-earnings ratio than Voya Financial, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

13.0% of Neostellar Capital shares are held by institutional investors. Comparatively, 96.1% of Voya Financial shares are held by institutional investors. 8.3% of Neostellar Capital shares are held by insiders. Comparatively, 1.6% of Voya Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

Neostellar Capital has a beta of 1.49, indicating that its stock price is 49% more volatile than the S&P 500. Comparatively, Voya Financial has a beta of 0.85, indicating that its stock price is 15% less volatile than the S&P 500.

Dividends

Neostellar Capital pays an annual dividend of $0.25 per share and has a dividend yield of 4.3%. Voya Financial pays an annual dividend of $1.88 per share and has a dividend yield of 1.9%. Neostellar Capital pays out 8.5% of its earnings in the form of a dividend. Voya Financial pays out 30.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Voya Financial has increased its dividend for 6 consecutive years. Neostellar Capital is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a summary of recent recommendations for Neostellar Capital and Voya Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Neostellar Capital	0	1	4	1	3.00
Voya Financial	1	4	7	1	2.62

Neostellar Capital presently has a consensus target price of $12.75, suggesting a potential upside of 121.35%. Voya Financial has a consensus target price of $103.69, suggesting a potential upside of 4.74%. Given Neostellar Capital’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Neostellar Capital is more favorable than Voya Financial.

Summary

Voya Financial beats Neostellar Capital on 9 of the 17 factors compared between the two stocks.

About Neostellar Capital

SuRo Capital Corp. is a business development company. The firm seeks to invest in growing, late stage, venture capital-backed private companies. SuRo Capital Corp. was founded in 2010 and is based in San Francisco, California.

About Voya Financial

Voya Financial, Inc. engages in the provision of workplace benefits and savings products in the United States and internationally. The company operates through three segments: Wealth Solutions, Health Solutions, and Investment Management. The Wealth Solutions segment offers full-service retirement products; recordkeeping services; stable value and fixed general account investment products; non-qualified plan administration services; and tools, guidance, and services to promote the financial well-being and retirement security of employees. The segment also provides wealth management services, such as individual retirement, managed, and brokerage accounts, as well as financial guidance and advisory services. This segment serves corporate, public and private school systems, higher education institutions, hospitals and healthcare facilities, other non-profit organizations, and state and local governments, as well as institutional and individual customers. The Health Solutions segment offers various insurance products comprising stop loss, group life, group disability, whole life, critical illness, accident, and hospital indemnity insurance. The segment also provides worksite employee benefits, health account solutions, leave management, benefits administration, health plan enrollment, financial wellness, and decision support products and services to mid-size and large corporate employers and professional associations. The Investment Management segment provides fixed income, equity, multi-asset, and alternative products and solutions to individual investors and institutional clients through its direct sales force, consultant channel, banks, broker-dealers, and independent financial advisers. The company was formerly known as ING U.S., Inc. and changed its name to Voya Financial, Inc. in April 2014. Voya Financial, Inc. was founded in 1975 and is based in New York, New York.