Critical Contrast: OFS Capital Corporation (OFS) and BlackRock Enhanced Global Dividend Trust (BOE)
OFS Capital Corporation (NASDAQ: OFS) and BlackRock Enhanced Global Dividend Trust (NYSE:BOE) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, earnings, valuation, institutional ownership, risk, profitability and analyst recommendations.
Insider and Institutional Ownership
28.7% of OFS Capital Corporation shares are held by institutional investors. 0.0% of OFS Capital Corporation shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Earnings and Valuation
This table compares OFS Capital Corporation and BlackRock Enhanced Global Dividend Trust’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|OFS Capital Corporation||N/A||N/A||N/A||$1.08||12.11|
|BlackRock Enhanced Global Dividend Trust||N/A||N/A||N/A||N/A||N/A|
This table compares OFS Capital Corporation and BlackRock Enhanced Global Dividend Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|OFS Capital Corporation||31.02%||9.43%||4.69%|
|BlackRock Enhanced Global Dividend Trust||N/A||N/A||N/A|
This is a breakdown of current ratings and recommmendations for OFS Capital Corporation and BlackRock Enhanced Global Dividend Trust, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|OFS Capital Corporation||1||1||3||0||2.40|
|BlackRock Enhanced Global Dividend Trust||0||0||0||0||N/A|
OFS Capital Corporation presently has a consensus price target of $14.25, suggesting a potential upside of 8.94%. Given OFS Capital Corporation’s higher possible upside, equities research analysts clearly believe OFS Capital Corporation is more favorable than BlackRock Enhanced Global Dividend Trust.
OFS Capital Corporation pays an annual dividend of $1.36 per share and has a dividend yield of 10.4%. BlackRock Enhanced Global Dividend Trust does not pay a dividend. OFS Capital Corporation pays out 125.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
OFS Capital Corporation beats BlackRock Enhanced Global Dividend Trust on 8 of the 9 factors compared between the two stocks.
About OFS Capital Corporation
OFS Capital Corporation (OFS Capital) is an externally managed, closed-end, non-diversified management investment company. The Company’s investment objective is to provide its shareholders with both current income and capital appreciation primarily through debt investments and equity investments. It focuses primarily on middle-market companies in the United States, including senior secured loans, including first-lien, second-lien and unitranche loans, as well as subordinated loans, and warrants and other minority equity securities. The Company may make investments directly or through OFS SBIC I, LP (SBIC I LP), its investment company subsidiary. It focuses on investments in loans, in which OFS Advisor’s investment professionals have expertise, including investments in first-lien, unitranche, second-lien, and mezzanine loans and, to a lesser extent, on warrants and other equity securities. The Company’s investment activities are managed by OFS Capital Management, LLC (OFS Advisor).
About BlackRock Enhanced Global Dividend Trust
BlackRock Enhanced Global Dividend Trust (the Trust), formerly BlackRock Global Opportunities Equity Trust, is a diversified, closed-end management investment company. The Trust’s investment objective is to provide current income and current gains, with a secondary objective of long-term capital appreciation. The Trust seeks to achieve its investment objectives by investing primarily in equity securities issued by companies located in countries throughout the world and utilizing an option writing (selling) strategy. The Trust focuses on investing in sectors, including information technology, financials, healthcare, materials, energy and utilities. The Trust invests at least 80% of its assets in equity securities or options on equity securities or indices or sectors of equity securities. The Trust invests amount of its total assets in foreign issuers. BlackRock Advisors, LLC is its investment advisor.
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