Head to Head Survey: Kayne Anderson BDC (NYSE:KBDC) and Medallion Financial (NASDAQ:MFIN)

Kayne Anderson BDC (NYSE:KBDC) and Medallion Financial (NASDAQ:MFIN) are both small-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, institutional ownership, earnings, dividends, profitability and risk.

Dividends

Kayne Anderson BDC pays an annual dividend of $1.60 per share and has a dividend yield of 10.9%. Medallion Financial pays an annual dividend of $0.48 per share and has a dividend yield of 5.0%. Kayne Anderson BDC pays out 106.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Medallion Financial pays out 28.1% of its earnings in the form of a dividend.

Volatility & Risk

Kayne Anderson BDC has a beta of 0.18, meaning that its share price is 82% less volatile than the S&P 500. Comparatively, Medallion Financial has a beta of 1.39, meaning that its share price is 39% more volatile than the S&P 500.

Profitability

This table compares Kayne Anderson BDC and Medallion Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kayne Anderson BDC	46.55%	10.40%	5.44%
Medallion Financial	12.12%	9.40%	1.55%

Earnings & Valuation

This table compares Kayne Anderson BDC and Medallion Financial”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kayne Anderson BDC	$213.11 million	4.73	$131.94 million	$1.51	9.76
Medallion Financial	$229.57 million	0.97	$35.88 million	$1.71	5.60

Kayne Anderson BDC has higher earnings, but lower revenue than Medallion Financial. Medallion Financial is trading at a lower price-to-earnings ratio than Kayne Anderson BDC, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

40.6% of Medallion Financial shares are owned by institutional investors. 3.1% of Kayne Anderson BDC shares are owned by insiders. Comparatively, 24.6% of Medallion Financial shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Kayne Anderson BDC and Medallion Financial, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kayne Anderson BDC	0	1	3	0	2.75
Medallion Financial	0	1	1	1	3.00

Kayne Anderson BDC presently has a consensus target price of $15.50, suggesting a potential upside of 5.16%. Medallion Financial has a consensus target price of $12.00, suggesting a potential upside of 25.39%. Given Medallion Financial’s stronger consensus rating and higher possible upside, analysts plainly believe Medallion Financial is more favorable than Kayne Anderson BDC.

Summary

Medallion Financial beats Kayne Anderson BDC on 9 of the 17 factors compared between the two stocks.

About Kayne Anderson BDC

Kayne Anderson BDC Inc. is a business development company which invests primarily in first lien senior secured loans, with a secondary focus on unitranche and split-lien loans to middle market companies. Kayne Anderson BDC Inc. is based in CHICAGO.

About Medallion Financial

Medallion Financial Corp., together with its subsidiaries, operates as a specialty finance company in the United States. It operates in four segments: Recreation Lending, Home Improvement Lending, Commercial Lending, and Taxi Medallion Lending. The company offers loans that finance consumer purchases of recreational vehicles, boats, and other consumer recreational equipment; consumer financing for window, siding, and roof replacement, swimming pool installations, and other home improvement projects; senior and subordinated loans for the purchase of equipment and related assets necessary to open a new business, or purchase or improvement of an existing business; and taxi medallion loans to individuals and small to mid-size businesses. It also provides debt, mezzanine, and equity investment capital to companies in various commercial industries; and raises deposits and conducts other banking activities. Medallion Financial Corp. was incorporated in 1995 and is headquartered in New York City, New York.