Head to Head Contrast: Golub Capital BDC (NASDAQ:GBDC) versus Chicago Atlantic BDC (NASDAQ:LIEN)

Golub Capital BDC (NASDAQ:GBDC) and Chicago Atlantic BDC (NASDAQ:LIEN) are both finance companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, institutional ownership, profitability and dividends.

Profitability

This table compares Golub Capital BDC and Chicago Atlantic BDC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Golub Capital BDC	42.81%	10.87%	4.87%
Chicago Atlantic BDC	21.50%	3.25%	3.07%

Insider & Institutional Ownership

42.4% of Golub Capital BDC shares are owned by institutional investors. Comparatively, 4.4% of Chicago Atlantic BDC shares are owned by institutional investors. 3.6% of Golub Capital BDC shares are owned by company insiders. Comparatively, 16.9% of Chicago Atlantic BDC shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Golub Capital BDC and Chicago Atlantic BDC”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Golub Capital BDC	$397.72 million	9.28	$273.79 million	$1.42	9.75
Chicago Atlantic BDC	$21.67 million	10.73	$9.62 million	$0.37	27.54

Golub Capital BDC has higher revenue and earnings than Chicago Atlantic BDC. Golub Capital BDC is trading at a lower price-to-earnings ratio than Chicago Atlantic BDC, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings and recommmendations for Golub Capital BDC and Chicago Atlantic BDC, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Golub Capital BDC	0	2	2	0	2.50
Chicago Atlantic BDC	0	3	0	0	2.00

Golub Capital BDC presently has a consensus target price of $15.00, suggesting a potential upside of 8.30%. Given Golub Capital BDC’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Golub Capital BDC is more favorable than Chicago Atlantic BDC.

Dividends

Golub Capital BDC pays an annual dividend of $1.56 per share and has a dividend yield of 11.3%. Chicago Atlantic BDC pays an annual dividend of $1.36 per share and has a dividend yield of 13.3%. Golub Capital BDC pays out 109.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Chicago Atlantic BDC pays out 367.6% 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 and Risk

Golub Capital BDC has a beta of 0.47, indicating that its stock price is 53% less volatile than the S&P 500. Comparatively, Chicago Atlantic BDC has a beta of 0.27, indicating that its stock price is 73% less volatile than the S&P 500.

Summary

Golub Capital BDC beats Chicago Atlantic BDC on 12 of the 16 factors compared between the two stocks.

About Golub Capital BDC

Golub Capital BDC, Inc. (GBDC) is a business development company and operates as an externally managed closed-end non-diversified management investment company. It invests in debt and minority equity investments in middle-market companies that are, in most cases, sponsored by private equity investors. It typically invests in diversified consumer services, automobiles, healthcare technology, insurance, health care equipment and supplies, hotels, restaurants and leisure, healthcare providers and services, IT services and specialty retails. It seeks to invest in the United States. It primarily invests in first lien traditional senior debt, first lien one stop, junior debt and equity, senior secured, one stop, unitranche, second lien, subordinated and mezzanine loans of middle-market companies, and warrants.

About Chicago Atlantic BDC

Chicago Atlantic BDC Inc. is a specialty finance company which has elected to be regulated as a business development company. Its investment objective is to maximize risk-adjusted returns on equity for its stockholders by investing primarily in direct loans to privately held middle-market companies, with a primary focus on cannabis companies. Chicago Atlantic BDC Inc., formerly known as CHICAGO ATLNTIC, is based in NEW YORK.