Invesco Bond Fund (VBF) vs. Golub Capital BDC (GBDC) Head to Head Review
Invesco Bond Fund (NYSE: VBF) and Golub Capital BDC (NASDAQ:GBDC) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their dividends, analyst recommendations, risk, profitability, institutional ownership, valuation and earnings.
Volatility & Risk
Invesco Bond Fund has a beta of 0.22, meaning that its share price is 78% less volatile than the S&P 500. Comparatively, Golub Capital BDC has a beta of 0.67, meaning that its share price is 33% less volatile than the S&P 500.
Insider & Institutional Ownership
19.7% of Invesco Bond Fund shares are held by institutional investors. Comparatively, 41.8% of Golub Capital BDC shares are held by institutional investors. 1.0% of Invesco Bond Fund shares are held by company insiders. Comparatively, 2.4% of Golub Capital BDC shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This table compares Invesco Bond Fund and Golub Capital BDC’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Invesco Bond Fund||N/A||N/A||N/A|
|Golub Capital BDC||53.62%||7.86%||3.95%|
Earnings and Valuation
This table compares Invesco Bond Fund and Golub Capital BDC’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Invesco Bond Fund||N/A||N/A||N/A||N/A||N/A|
|Golub Capital BDC||$127.87 million||8.84||$69.20 million||$1.33||14.29|
Golub Capital BDC has higher revenue and earnings than Invesco Bond Fund.
Invesco Bond Fund pays an annual dividend of $0.84 per share and has a dividend yield of 4.2%. Golub Capital BDC pays an annual dividend of $1.28 per share and has a dividend yield of 6.7%. Golub Capital BDC pays out 96.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
This is a breakdown of current recommendations for Invesco Bond Fund and Golub Capital BDC, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Invesco Bond Fund||0||0||0||0||N/A|
|Golub Capital BDC||0||3||0||0||2.00|
Golub Capital BDC has a consensus price target of $19.50, suggesting a potential upside of 2.63%. Given Golub Capital BDC’s higher probable upside, analysts clearly believe Golub Capital BDC is more favorable than Invesco Bond Fund.
Golub Capital BDC beats Invesco Bond Fund on 9 of the 10 factors compared between the two stocks.
About Invesco Bond Fund
Invesco Bond Fund is a diversified, closed-end management investment company. The Fund’s investment objective is to seek interest income while conserving capital. The Fund invests primarily in fixed-rate the United States investment-grade corporate bonds with flexibility to integrate approximately 20% of its total assets in non-investment-grade, the United States dollar denominated and non-United States dollar denominated securities of foreign issuers (both developed and emerging markets). The Fund also invests in government securities, asset-backed securities, commercial mortgage-backed securities and residential mortgage-backed securities. The Fund also invests in derivatives and other instruments that have similar economic characteristics to securities, in which it invests. Invesco Advisers, Inc. serves as the investment advisor of the Fund.
About Golub Capital BDC
Golub Capital BDC, Inc. is an externally managed, non-diversified, closed-end, management investment company. The Company’s investment objective is to generate current income and capital appreciation by investing primarily in senior secured and one stop loans of the United States middle-market companies. It may also selectively invest in second lien and subordinated loans of, and warrants and minority equity securities in the United States middle-market companies. The Company seeks to create a portfolio that includes primarily senior secured and one stop loans by primarily investing in the securities of the United States middle-market companies. It generally invests in securities that have been rated below investment grade by independent rating agencies or that would be rated below investment grade if they were rated. The Company’s investment activities are managed by its investment advisor, GC Advisors LLC (GC Advisors).
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