Head to Head Comparison: Oportun Financial (NASDAQ:OPRT) and Oaktree Specialty Lending (NASDAQ:OCSL)

Oaktree Specialty Lending (NASDAQ:OCSL) and Oportun Financial (NASDAQ:OPRT) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their valuation, profitability, institutional ownership, risk, earnings, dividends and analyst recommendations.

Valuation and Earnings

This table compares Oaktree Specialty Lending and Oportun Financial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Oaktree Specialty Lending	$35.77 million	34.03	$57.90 million	$0.56	24.68
Oportun Financial	$1.00 billion	0.23	-$78.68 million	($0.20)	-26.43

Oaktree Specialty Lending has higher earnings, but lower revenue than Oportun Financial. Oportun Financial is trading at a lower price-to-earnings ratio than Oaktree Specialty Lending, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

36.8% of Oaktree Specialty Lending shares are owned by institutional investors. Comparatively, 82.7% of Oportun Financial shares are owned by institutional investors. 0.3% of Oaktree Specialty Lending shares are owned by insiders. Comparatively, 9.3% of Oportun Financial shares are owned by 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 Oaktree Specialty Lending and Oportun Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Oaktree Specialty Lending	13.84%	10.94%	5.23%
Oportun Financial	-0.47%	13.15%	1.45%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Oaktree Specialty Lending and Oportun Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Oaktree Specialty Lending	0	9	0	0	2.00
Oportun Financial	2	3	2	0	2.00

Oaktree Specialty Lending currently has a consensus price target of $15.00, suggesting a potential upside of 8.54%. Oportun Financial has a consensus price target of $8.67, suggesting a potential upside of 63.99%. Given Oportun Financial’s higher probable upside, analysts clearly believe Oportun Financial is more favorable than Oaktree Specialty Lending.

Risk & Volatility

Oaktree Specialty Lending has a beta of 0.66, indicating that its stock price is 34% less volatile than the S&P 500. Comparatively, Oportun Financial has a beta of 1.35, indicating that its stock price is 35% more volatile than the S&P 500.

Summary

Oportun Financial beats Oaktree Specialty Lending on 7 of the 13 factors compared between the two stocks.

About Oaktree Specialty Lending

Oaktree Specialty Lending Corporation is a business development company. The fund specializing in investments in middle market, bridge financing, first and second lien debt financing, unsecured and mezzanine loan, mezzanine debt, senior and junior secured debt, expansions, sponsor-led acquisitions, preferred equity, and management buyouts in small and mid-sized companies. It seeks to invest in education services, business services, retail and consumer, healthcare, manufacturing, food and restaurants, construction and engineering. The firm also seeks investment in media, advertising sectors, software, IT services, pharmaceuticals, biotechnology, real estate management and development, chemicals, machinery, and internet and direct marketing retail sectors. It invests between $5 million to $75 million principally in the form of one-stop, first lien, and second lien debt investments, which may include an equity co-investment component in companies. The firm invest in companies having enterprise value between $20 million and $150 million and EBITDA between $3 million and $50 million. The fund has a hold size of up to $75 million and may underwrite transactions up to $100 million. It primarily invests in North America. The fund seeks to be a lead investor in its portfolio companies.

About Oportun Financial

Oportun Financial Corporation provides financial services. The company offers personal loans and credit cards. It serves customers through online and over the phone, as well as through retail and Lending as a Service partner locations. The company was founded in 2005 and is headquartered in San Carlos, California.