THL Credit (NASDAQ: TCRD) is one of 570 publicly-traded companies in the “Closed End Funds” industry, but how does it weigh in compared to its peers? We will compare THL Credit to related companies based on the strength of its analyst recommendations, profitability, valuation, institutional ownership, earnings, risk and dividends.

Dividends

THL Credit pays an annual dividend of $1.08 per share and has a dividend yield of 11.5%. THL Credit pays out 145.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Closed End Funds” companies pay a dividend yield of 8.7% and pay out 87.0% of their earnings in the form of a dividend.

Risk & Volatility

THL Credit has a beta of 1.08, meaning that its share price is 8% more volatile than the S&P 500. Comparatively, THL Credit’s peers have a beta of 0.55, meaning that their average share price is 45% less volatile than the S&P 500.

Insider and Institutional Ownership

45.6% of THL Credit shares are held by institutional investors. Comparatively, 23.2% of shares of all “Closed End Funds” companies are held by institutional investors. 0.8% of THL Credit shares are held by company insiders. Comparatively, 3.5% of shares of all “Closed End Funds” companies are held 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.

Profitability

This table compares THL Credit and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
THL Credit 29.81% 10.22% 5.66%
THL Credit Competitors -51.11% 6.07% 4.66%

Earnings & Valuation

This table compares THL Credit and its peers gross revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
THL Credit N/A N/A 12.69
THL Credit Competitors $57.58 million $38.86 million -0.09

THL Credit’s peers have higher revenue and earnings than THL Credit. THL Credit is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Analyst Recommendations

This is a summary of current recommendations and price targets for THL Credit and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
THL Credit 0 5 2 0 2.29
THL Credit Competitors 192 1181 1412 13 2.45

THL Credit currently has a consensus price target of $11.00, indicating a potential upside of 17.15%. As a group, “Closed End Funds” companies have a potential upside of 39.47%. Given THL Credit’s peers stronger consensus rating and higher possible upside, analysts plainly believe THL Credit has less favorable growth aspects than its peers.

THL Credit Company Profile

THL Credit, Inc. 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, primarily through investments in privately negotiated debt and equity securities of lower middle market companies. The Company is a direct lender to lower middle-market companies and invests primarily in directly originated first lien senior secured loans, including unitranche investments. In certain instances, it also makes second lien secured loans and subordinated, or mezzanine, debt investments, which may include an associated equity component, such as warrants, preferred stock or similar securities, and direct equity investments. Its first lien senior secured loans may be structured as traditional first lien senior secured loans or as unitranche loans. The Company’s investment activities are managed by THL Credit Advisors LLC.

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