Invesco California Value Municipal Income Trust (NYSE: VCV) and Capitala Finance Corp. (NASDAQ:CPTA) are both small-cap closed end funds companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, valuation, risk, earnings, analyst recommendations, dividends and institutional ownership.

Dividends

Invesco California Value Municipal Income Trust pays an annual dividend of $0.59 per share and has a dividend yield of 4.6%. Capitala Finance Corp. pays an annual dividend of $1.00 per share and has a dividend yield of 12.9%. Capitala Finance Corp. pays out 909.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Insider & Institutional Ownership

8.2% of Invesco California Value Municipal Income Trust shares are held by institutional investors. Comparatively, 25.8% of Capitala Finance Corp. shares are held by institutional investors. 1.0% of Invesco California Value Municipal Income Trust shares are held by company insiders. Comparatively, 8.4% of Capitala Finance Corp. shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Invesco California Value Municipal Income Trust and Capitala Finance Corp.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Invesco California Value Municipal Income Trust N/A N/A N/A
Capitala Finance Corp. 3.04% 7.49% 3.19%

Analyst Ratings

This is a breakdown of current recommendations and price targets for Invesco California Value Municipal Income Trust and Capitala Finance Corp., as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Invesco California Value Municipal Income Trust 0 0 0 0 N/A
Capitala Finance Corp. 0 3 2 0 2.40

Capitala Finance Corp. has a consensus target price of $13.50, indicating a potential upside of 73.52%. Given Capitala Finance Corp.’s higher possible upside, analysts clearly believe Capitala Finance Corp. is more favorable than Invesco California Value Municipal Income Trust.

Volatility and Risk

Invesco California Value Municipal Income Trust has a beta of -0.12, meaning that its share price is 112% less volatile than the S&P 500. Comparatively, Capitala Finance Corp. has a beta of 1.02, meaning that its share price is 2% more volatile than the S&P 500.

Valuation & Earnings

This table compares Invesco California Value Municipal Income Trust and Capitala Finance Corp.’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Invesco California Value Municipal Income Trust N/A N/A N/A N/A N/A
Capitala Finance Corp. $68.31 million 1.82 $9.15 million $0.11 70.73

Capitala Finance Corp. has higher revenue and earnings than Invesco California Value Municipal Income Trust.

Summary

Capitala Finance Corp. beats Invesco California Value Municipal Income Trust on 10 of the 11 factors compared between the two stocks.

Invesco California Value Municipal Income Trust Company Profile

Invesco Van Kampen California Value Municipal Income Trust (the Trust), formerly Invesco California Value Municipal Income Trust, is a diversified, closed-end management investment trust. The Trust’s investment objective is to seek to provide common shareholders with a high level of current income exempt from federal and California income taxes, consistent with preservation of capital. The Trust will invest substantially all of its assets in California municipal securities rated investment grade at the time of investment. The Trust seeks to achieve its investment objective by investing primarily in California municipal securities that are rated investment grade at the time of investment. Municipal securities include municipal bonds, municipal notes, municipal commercial paper and lease obligations. Invesco Advisers, Inc. serves as its investment advisor.

Capitala Finance Corp. Company Profile

Capitala Finance Corp. is an externally managed non-diversified, closed-end management investment company. The Company’s investment objective is to generate both current income and capital appreciation through debt and equity investments. Both directly and through its subsidiaries that are licensed by the United States Small Business Administration (SBA), the Company offers financing to business owners, management teams and financial sponsors for change of ownership transactions, recapitalizations, strategic acquisitions, business expansion and other growth initiatives. The Company provides capital to lower and traditional middle-market companies in the United States, with a non-exclusive emphasis on the Southeast, Southwest and Mid-Atlantic regions. The Company invests in first lien, second lien and subordinated loans. The Company’s investment advisor is Capitala Investment Advisors, LLC.

Receive News & Ratings for Invesco California Value Municipal Income Trust Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Invesco California Value Municipal Income Trust and related companies with Analyst Ratings Network's FREE daily email newsletter.