PJT Partners (NYSE:PJT) and Saratoga Investment (NYSE:SAR) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, valuation, profitability, risk and dividends.

Risk & Volatility

PJT Partners has a beta of 0.39, meaning that its stock price is 61% less volatile than the S&P 500. Comparatively, Saratoga Investment has a beta of 0.12, meaning that its stock price is 88% less volatile than the S&P 500.

Valuation and Earnings

This table compares PJT Partners and Saratoga Investment’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
PJT Partners $499.28 million 1.87 -$28.32 million $1.54 29.53
Saratoga Investment $38.62 million 4.49 $17.67 million $2.27 10.25

Saratoga Investment has lower revenue, but higher earnings than PJT Partners. Saratoga Investment is trading at a lower price-to-earnings ratio than PJT Partners, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent recommendations for PJT Partners and Saratoga Investment, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PJT Partners 0 3 0 0 2.00
Saratoga Investment 0 2 3 0 2.60

PJT Partners currently has a consensus target price of $57.67, suggesting a potential upside of 26.80%. Saratoga Investment has a consensus target price of $23.83, suggesting a potential upside of 2.46%. Given PJT Partners’ higher possible upside, equities analysts clearly believe PJT Partners is more favorable than Saratoga Investment.

Profitability

This table compares PJT Partners and Saratoga Investment’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PJT Partners -4.11% 24.71% 12.78%
Saratoga Investment 50.76% 10.52% 4.12%

Insider and Institutional Ownership

62.5% of PJT Partners shares are owned by institutional investors. Comparatively, 14.3% of Saratoga Investment shares are owned by institutional investors. 8.0% of PJT Partners shares are owned by insiders. Comparatively, 24.8% of Saratoga Investment shares are owned 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.

Dividends

PJT Partners pays an annual dividend of $0.20 per share and has a dividend yield of 0.4%. Saratoga Investment pays an annual dividend of $2.08 per share and has a dividend yield of 8.9%. PJT Partners pays out 13.0% of its earnings in the form of a dividend. Saratoga Investment pays out 91.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Saratoga Investment has raised its dividend for 2 consecutive years. Saratoga Investment is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Saratoga Investment beats PJT Partners on 9 of the 17 factors compared between the two stocks.

PJT Partners Company Profile

PJT Partners Inc. provides various strategic advisory, restructuring and special situations, and private fund advisory and placement services to corporations, financial sponsors, institutional investors, and governments worldwide. It offers a range of financial advisory and transaction execution capability, including mergers and acquisitions, joint ventures, minority investments, asset swaps, divestitures, takeover defenses, corporate finance advisory, private placements, and distressed sales. The company also advices companies, creditors, and financial sponsors on recapitalizations, reorganizations, exchange offers, debt repurchases, capital raises, and distressed mergers and acquisitions. In addition, it offers private fund advisory and placement services for a range of investment strategies, including private equity, hedge fund, real estate, and secondary advisory. The company was formerly known as Blackstone Advisory Inc. and changed its name to PJT Partners Inc. in March 2015. PJT Partners Inc. was incorporated in 2014 and is headquartered in New York, New York.

Saratoga Investment Company Profile

Saratoga Investment Corp. is a business development company specializing in leveraged and management buyouts, acquisition financings, growth financings, recapitalization, debt refinancing, and transitional financing transactions at the lower end of middle market companies. It structures its investments as debt and equity by investing through first and second lien loans, mezzanine debt, co-investments, select high yield bonds, senior secured bonds, unsecured bonds, and preferred and common equity. It seeks to invest in the United States. The firm primarily invests $5 million to $20 million in companies having EBITDA of $2 million or greater and revenues of $8 million to $150 million. It invests through direct lending as well as participation in loan syndicates. The firm was formerly known as GSC Investment Corp. Saratoga Investment Corp. is based in New York, New York with an additional office in Florham Park, New Jersey.

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