Head to Head Survey: CION Investment (NYSE:CION) vs. Chicago Atlantic BDC (NASDAQ:LIEN)

Chicago Atlantic BDC (NASDAQ:LIEN) and CION Investment (NYSE:CION) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, risk, valuation, profitability and institutional ownership.

Analyst Recommendations

This is a summary of current recommendations for Chicago Atlantic BDC and CION Investment, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Chicago Atlantic BDC	0	0	0	1	4.00
CION Investment	2	0	0	1	2.00

CION Investment has a consensus price target of $6.50, suggesting a potential upside of 3.75%. Given CION Investment’s higher possible upside, analysts clearly believe CION Investment is more favorable than Chicago Atlantic BDC.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Chicago Atlantic BDC	57.88%	11.67%	10.30%
CION Investment	-0.41%	11.96%	4.64%

Dividends

Chicago Atlantic BDC pays an annual dividend of $1.36 per share and has a dividend yield of 13.8%. CION Investment pays an annual dividend of $1.20 per share and has a dividend yield of 19.2%. Chicago Atlantic BDC pays out 90.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CION Investment pays out -3,000.0% of its earnings in the form of a dividend. CION Investment has raised its dividend for 1 consecutive years. CION Investment is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

4.4% of Chicago Atlantic BDC shares are owned by institutional investors. Comparatively, 32.0% of CION Investment shares are owned by institutional investors. 12.9% of Chicago Atlantic BDC shares are owned by insiders. Comparatively, 0.6% of CION Investment shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Risk & Volatility

Chicago Atlantic BDC has a beta of 0.27, meaning that its stock price is 73% less volatile than the S&P 500. Comparatively, CION Investment has a beta of 1.1, meaning that its stock price is 10% more volatile than the S&P 500.

Earnings and Valuation

This table compares Chicago Atlantic BDC and CION Investment”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Chicago Atlantic BDC	$54.30 million	4.15	$33.28 million	$1.50	6.58
CION Investment	$240.82 million	1.30	-$20.63 million	($0.04)	-156.62

Chicago Atlantic BDC has higher earnings, but lower revenue than CION Investment. CION Investment 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.

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.

About CION Investment

CION Investment Corporation is a business development company. It specializes in investments in senior secured loans, including unitranche loans, First Lien, second lien loans, long-term subordinated loans, and mezzanine loans; equity interests such as warrants or options; and corporate bonds; and other debt securities in middle-market companies. The firm invests in growth capital, acquisitions, leveraged buyouts, market/product expansion, refinancing and recapitalization. The fund also invests up to 30 percent of their assets opportunistically in other types of investments, including the securities of larger public companies and foreign securities. It also makes investments in the secondary loan market. The fund does not invest in start-up companies, turnaround situations, or companies with speculative business plans. The fund prefers to invest in high tech industries, healthcare, pharmaceuticals, business services, media, chemicals, plastic, rubber, telecommunication, consumer services, advertising, printing and publishing, consumer goods, durables, diversified financials, and other industries. It also invests in homebuilding, restaurants, beverage and tobacco bars, broadcasting, distributors, Non-durable good distribution, food beverage and tobacco, energy, oil gas and consumables fuels, insurance, aerospace and defense, industrial machinery, paper and forest product machinery, information technology, metals and mining, and real estate. It primarily seeks to invest in the United States. The fund seeks to invest between $5 million and $50 million in companies with an EBITDA between $25 million and $75 million with average targeted hold of $25 million. It also purchases minority interests in the form of common or preferred equity in the target companies, typically in conjunction with its debt investments or through a co-investment with a financial sponsor. The fund seeks to exit its investments through an initial public offering of common stock, a merger, a sale, or other recapitalization.