Blue Owl Capital (NYSE:OBDC – Get Free Report) and Applied Digital (NASDAQ:APLD – Get Free Report) are both mid-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, risk, dividends, profitability, institutional ownership and valuation.
Profitability
This table compares Blue Owl Capital and Applied Digital’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Blue Owl Capital | 38.29% | 11.24% | 4.82% |
| Applied Digital | -107.22% | -50.03% | -13.45% |
Analyst Ratings
This is a summary of recent ratings and target prices for Blue Owl Capital and Applied Digital, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Blue Owl Capital | 0 | 2 | 3 | 3 | 3.13 |
| Applied Digital | 0 | 0 | 12 | 1 | 3.08 |
Institutional & Insider Ownership
42.8% of Blue Owl Capital shares are held by institutional investors. Comparatively, 65.7% of Applied Digital shares are held by institutional investors. 0.1% of Blue Owl Capital shares are held by insiders. Comparatively, 9.5% of Applied Digital shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Earnings and Valuation
This table compares Blue Owl Capital and Applied Digital”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Blue Owl Capital | $1.60 billion | 4.08 | $741.06 million | $1.51 | 8.44 |
| Applied Digital | $144.19 million | 43.59 | -$231.07 million | ($1.09) | -21.05 |
Blue Owl Capital has higher revenue and earnings than Applied Digital. Applied Digital is trading at a lower price-to-earnings ratio than Blue Owl Capital, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Blue Owl Capital has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500. Comparatively, Applied Digital has a beta of 6.64, suggesting that its stock price is 564% more volatile than the S&P 500.
Summary
Blue Owl Capital beats Applied Digital on 10 of the 15 factors compared between the two stocks.
About Blue Owl Capital
Blue Owl Capital Corporation is a business development company. It specializes in direct and fund of fund investments. The fund makes investments in senior secured, direct lending or unsecured loans, subordinated loans or mezzanine loans and also considers equity-related securities including warrants and preferred stocks also pursues preferred equity investments, first lien, unitranche, and second lien term loans and common equity investments. Within private equity, it seeks to invest in growth, acquisitions, market or product expansion, refinancings and recapitalizations. It seeks to invest in middle market and upper middle market companies based in the United States, with EBITDA between $10 million and $250 million annually and/or annual revenue of $50 million and $2.5 billion at the time of investment. It seeks to invest in investments with maturities typically between three and ten years. It seeks to make investments generally ranging in size between $20 million and $250 million.
About Applied Digital
Applied Digital Corporation designs, develops, and operates datacenters in North America. Its datacenters provide digital infrastructure solutions to the high-performance computing industry. The company also provides artificial intelligence cloud services, high performance computing datacenter hosting, and crypto datacenter hosting services. The company was formerly known as Applied Blockchain, Inc. and changed its name to Applied Digital Corporation in November 2022. Applied Digital Corporation is based in Dallas, Texas.
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