Critical Contrast: FS Investment Corporation (FSIC) versus Tortoise Energy Infrastructure Corporation (TYG)
FS Investment Corporation (NYSE: FSIC) and Tortoise Energy Infrastructure Corporation (NYSE:TYG) are both small-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, risk, institutional ownership, dividends, profitability, analyst recommendations and earnings.
FS Investment Corporation pays an annual dividend of $0.89 per share and has a dividend yield of 10.9%. Tortoise Energy Infrastructure Corporation pays an annual dividend of $2.62 per share and has a dividend yield of 9.8%. FS Investment Corporation pays out 98.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Volatility & Risk
FS Investment Corporation has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500. Comparatively, Tortoise Energy Infrastructure Corporation has a beta of 1.28, meaning that its share price is 28% more volatile than the S&P 500.
This is a summary of current recommendations and price targets for FS Investment Corporation and Tortoise Energy Infrastructure Corporation, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|FS Investment Corporation||0||4||0||0||2.00|
|Tortoise Energy Infrastructure Corporation||0||0||1||0||3.00|
FS Investment Corporation currently has a consensus price target of $9.67, suggesting a potential upside of 17.89%. Tortoise Energy Infrastructure Corporation has a consensus price target of $34.00, suggesting a potential upside of 27.72%. Given Tortoise Energy Infrastructure Corporation’s stronger consensus rating and higher probable upside, analysts clearly believe Tortoise Energy Infrastructure Corporation is more favorable than FS Investment Corporation.
Insider and Institutional Ownership
32.4% of FS Investment Corporation shares are owned by institutional investors. Comparatively, 30.2% of Tortoise Energy Infrastructure Corporation shares are owned by institutional investors. 1.0% of FS Investment Corporation shares are owned by insiders. Comparatively, 0.3% of Tortoise Energy Infrastructure Corporation shares are owned 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.
Valuation and Earnings
This table compares FS Investment Corporation and Tortoise Energy Infrastructure Corporation’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|FS Investment Corporation||$422.81 million||4.77||$294.29 million||$0.90||9.11|
|Tortoise Energy Infrastructure Corporation||N/A||N/A||N/A||N/A||N/A|
FS Investment Corporation has higher revenue and earnings than Tortoise Energy Infrastructure Corporation.
This table compares FS Investment Corporation and Tortoise Energy Infrastructure Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|FS Investment Corporation||52.49%||8.99%||4.95%|
|Tortoise Energy Infrastructure Corporation||N/A||N/A||N/A|
FS Investment Corporation beats Tortoise Energy Infrastructure Corporation on 7 of the 12 factors compared between the two stocks.
FS Investment Corporation Company Profile
FS Investment Corporation is an externally managed, non-diversified, closed-end management investment company. The Company’s investment objectives are to generate current income and long-term capital appreciation. Its portfolio consists primarily of investments in senior secured loans and second lien secured loans of the private United States middle market companies and subordinated loans of the private United States companies. It may purchase interests in loans or make other debt investments, including investments in senior secured bonds, through secondary market transactions in the over-the-counter market or directly from target companies as primary market or directly originated investments. It invests in a range of industries, including capital goods; consumer services; consumer durables and apparel; materials; commercial and professional services, and diversified financials. Its investment advisor is FB Income Advisor, LLC.
Tortoise Energy Infrastructure Corporation Company Profile
Tortoise Energy Infrastructure Corporation (the Fund) is a non-diversified, closed-end management investment company. The Fund seeks a high level of total return with a focus on current distributions paid to stockholders. The Fund invests primarily in equity securities of master limited partnerships (MLPs) and their affiliates that transport, gather, process or store natural gas, natural gas liquids (NGLs), crude oil and refined petroleum products. Under normal circumstances, the Fund invests at least 90% of its total assets (including assets obtained through leverage) in securities of energy infrastructure companies and at least 70% of its total assets in equity securities of MLPs. The Fund may invest up to 30% of its total assets in restricted securities, primarily through direct placements. The Fund may invest up to 25% of its total assets in debt securities, including those rated below investment grade. Tortoise Capital Advisors, L.L.C. is the investment advisor of the Fund.
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