Portman Ridge Finance (NASDAQ:PTMN – Get Free Report) and KKR & Co. Inc. (NYSE:KKR – Get Free Report) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, profitability, analyst recommendations, institutional ownership and risk.
Profitability
This table compares Portman Ridge Finance and KKR & Co. Inc.’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Portman Ridge Finance | -15.92% | 11.49% | 4.54% |
| KKR & Co. Inc. | 13.94% | 5.50% | 0.99% |
Analyst Recommendations
This is a breakdown of current ratings and price targets for Portman Ridge Finance and KKR & Co. Inc., as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Portman Ridge Finance | 0 | 0 | 0 | 0 | 0.00 |
| KKR & Co. Inc. | 1 | 3 | 12 | 1 | 2.76 |
Dividends
Portman Ridge Finance pays an annual dividend of $1.88 per share and has a dividend yield of 22.5%. KKR & Co. Inc. pays an annual dividend of $0.74 per share and has a dividend yield of 0.7%. Portman Ridge Finance pays out -202.2% of its earnings in the form of a dividend. KKR & Co. Inc. pays out 25.2% 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. KKR & Co. Inc. has raised its dividend for 5 consecutive years. Portman Ridge Finance is clearly the better dividend stock, given its higher yield and lower payout ratio.
Earnings & Valuation
This table compares Portman Ridge Finance and KKR & Co. Inc.”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Portman Ridge Finance | -$2.85 million | -38.72 | -$5.93 million | ($0.93) | -8.98 |
| KKR & Co. Inc. | $19.46 billion | 4.69 | $2.37 billion | $2.94 | 34.86 |
KKR & Co. Inc. has higher revenue and earnings than Portman Ridge Finance. Portman Ridge Finance is trading at a lower price-to-earnings ratio than KKR & Co. Inc., indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Portman Ridge Finance has a beta of 0.6, indicating that its stock price is 40% less volatile than the S&P 500. Comparatively, KKR & Co. Inc. has a beta of 1.85, indicating that its stock price is 85% more volatile than the S&P 500.
Insider and Institutional Ownership
30.1% of Portman Ridge Finance shares are owned by institutional investors. Comparatively, 76.3% of KKR & Co. Inc. shares are owned by institutional investors. 2.1% of Portman Ridge Finance shares are owned by insiders. Comparatively, 23.2% of KKR & Co. Inc. shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Summary
KKR & Co. Inc. beats Portman Ridge Finance on 14 of the 18 factors compared between the two stocks.
About Portman Ridge Finance
Portman Ridge Finance Corporation is a business development company specializing in investments in unitranche loans (including last out), first lien loans, second lien loans, subordinated debt, equity co-investment, mezzanine, buyout in middle market companies. It also makes acquisitions in businesses complementary to the firm's business. It primarily invests in healthcare, cargo transport, manufacturing, industrial & environmental services, logistics & distribution, media & telecommunications, real estate, education, automotive, agriculture, aerospace/defense, packaging, electronics, finance, non-durable consumer, consumer products, business services, utilities, insurance, and food and beverage sectors. The fund typically invests $1 million to $20 million in its portfolio companies. It provides senior secured term loans from $2 million to $20 million maturing in five to seven years; second lien term loans from $5 million to $15 million maturing in six to eight years; senior unsecured loans $5 million to $23 million maturing in six to eight years; mezzanine loans from $5 million to $15 million maturing in seven to ten years; and equity investments from $1 to $5 million. The fund targets the companies with EBITDA between $5 million and $25 million. While investing in debt securities, it invests in those middle market firms with EBITDA between $10 million and $50 million and/or total debt between $25 million and $150 million. It invests in minority, and majority or control equity positions alongside its private equity sponsor partners.
About KKR & Co. Inc.
KKR & Co., Inc. operates as an investment firm. It offers alternative asset management as well as capital markets and insurance solutions. The firm’s business segments include Asset Management and Insurance Business. The Asset Management segment engages in providing private equity, real assets, credit and liquid strategies, capital markets, and principal activities. The Insurance Business segment offers retirement, life insurance and reinsurance solutions to clients across individual and institutional markets. The company was founded by Henry Kravis, George R. Roberts, and Jerome Kholberg on May 1, 1976 and is headquartered in New York, NY.
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