Comparing Crescent Capital BDC (NASDAQ:CCAP) & WhiteHorse Finance (NASDAQ:WHF)

WhiteHorse Finance (NASDAQ:WHF) and Crescent Capital BDC (NASDAQ:CCAP) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, dividends, valuation, institutional ownership and earnings.

Analyst Recommendations

This is a summary of current ratings and price targets for WhiteHorse Finance and Crescent Capital BDC, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
WhiteHorse Finance	2	3	0	0	1.60
Crescent Capital BDC	1	1	1	1	2.50

WhiteHorse Finance currently has a consensus target price of $7.75, suggesting a potential upside of 14.81%. Crescent Capital BDC has a consensus target price of $16.33, suggesting a potential upside of 20.19%. Given Crescent Capital BDC’s stronger consensus rating and higher probable upside, analysts clearly believe Crescent Capital BDC is more favorable than WhiteHorse Finance.

Earnings & Valuation

This table compares WhiteHorse Finance and Crescent Capital BDC”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
WhiteHorse Finance	$9.51 million	16.49	$10.85 million	$0.43	15.70
Crescent Capital BDC	$197.36 million	N/A	$73.65 million	$1.20	11.33

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

Insider and Institutional Ownership

13.2% of WhiteHorse Finance shares are owned by institutional investors. Comparatively, 49.5% of Crescent Capital BDC shares are owned by institutional investors. 2.5% of WhiteHorse Finance shares are owned by company insiders. Comparatively, 1.1% of Crescent Capital BDC shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares WhiteHorse Finance and Crescent Capital BDC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
WhiteHorse Finance	4.36%	10.72%	4.51%
Crescent Capital BDC	20.84%	9.71%	4.28%

Risk and Volatility

WhiteHorse Finance has a beta of 0.79, suggesting that its stock price is 21% less volatile than the S&P 500. Comparatively, Crescent Capital BDC has a beta of 0.57, suggesting that its stock price is 43% less volatile than the S&P 500.

Dividends

WhiteHorse Finance pays an annual dividend of $1.00 per share and has a dividend yield of 14.8%. Crescent Capital BDC pays an annual dividend of $1.68 per share and has a dividend yield of 12.4%. WhiteHorse Finance pays out 232.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Crescent Capital BDC pays out 140.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. WhiteHorse Finance has increased its dividend for 3 consecutive years and Crescent Capital BDC has increased its dividend for 1 consecutive years. WhiteHorse Finance is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Crescent Capital BDC beats WhiteHorse Finance on 10 of the 17 factors compared between the two stocks.

About WhiteHorse Finance

WhiteHorse Finance, Inc. is business development company, non-diversified, closed end management company specializing in originating senior secured loans, lower middle market, growth capital industries. It invests in broadline retail, office services and supplies, building products, health care services, health care supplies, research and consulting services, application software, home furnishings, specialized consumer services, data processing and outsourced services, leisure facilities, cable, and satellite. It prefers to invest in United States. It typically invests between $5 million to $25 million in companies having enterprise value of between $50 million and $350 million.

About Crescent Capital BDC

Crescent Capital BDC, Inc. is as a business development company private equity / buyouts and loan fund. It specializes in directly investing. It specializes in middle market. The fund seeks to invest in United States.