Reviewing Deutsche Bank Aktiengesellschaft (NYSE:DB) & MidCap Financial Investment (NASDAQ:MFIC)

Deutsche Bank Aktiengesellschaft (NYSE:DB) and MidCap Financial Investment (NASDAQ:MFIC) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, profitability, risk, valuation, dividends and earnings.

Analyst Ratings

This is a breakdown of recent ratings for Deutsche Bank Aktiengesellschaft and MidCap Financial Investment, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Deutsche Bank Aktiengesellschaft	0	5	5	0	2.50
MidCap Financial Investment	1	6	2	0	2.11

Deutsche Bank Aktiengesellschaft presently has a consensus price target of $43.00, indicating a potential upside of 6.19%. MidCap Financial Investment has a consensus price target of $11.11, indicating a potential upside of 22.87%. Given MidCap Financial Investment’s higher probable upside, analysts plainly believe MidCap Financial Investment is more favorable than Deutsche Bank Aktiengesellschaft.

Institutional & Insider Ownership

27.9% of Deutsche Bank Aktiengesellschaft shares are owned by institutional investors. Comparatively, 28.4% of MidCap Financial Investment shares are owned by institutional investors. 0.9% of MidCap Financial Investment shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Deutsche Bank Aktiengesellschaft and MidCap Financial Investment”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Deutsche Bank Aktiengesellschaft	$32.87 billion	2.39	$7.47 billion	$3.75	10.80
MidCap Financial Investment	$320.88 million	2.32	$63.17 million	($0.36)	-25.11

Deutsche Bank Aktiengesellschaft has higher revenue and earnings than MidCap Financial Investment. MidCap Financial Investment is trading at a lower price-to-earnings ratio than Deutsche Bank Aktiengesellschaft, indicating that it is currently the more affordable of the two stocks.

Dividends

Deutsche Bank Aktiengesellschaft pays an annual dividend of $0.21 per share and has a dividend yield of 0.5%. MidCap Financial Investment pays an annual dividend of $1.24 per share and has a dividend yield of 13.7%. Deutsche Bank Aktiengesellschaft pays out 5.6% of its earnings in the form of a dividend. MidCap Financial Investment pays out -344.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Deutsche Bank Aktiengesellschaft has increased its dividend for 4 consecutive years. MidCap Financial Investment is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility & Risk

Deutsche Bank Aktiengesellschaft has a beta of 0.96, meaning that its share price is 4% less volatile than the S&P 500. Comparatively, MidCap Financial Investment has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500.

Profitability

This table compares Deutsche Bank Aktiengesellschaft and MidCap Financial Investment’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Deutsche Bank Aktiengesellschaft	11.53%	8.46%	0.47%
MidCap Financial Investment	-9.85%	11.17%	4.41%

Summary

Deutsche Bank Aktiengesellschaft beats MidCap Financial Investment on 10 of the 17 factors compared between the two stocks.

About Deutsche Bank Aktiengesellschaft

Deutsche Bank Aktiengesellschaft, a stock corporation, provides corporate and investment banking, and asset management products and services to private individuals, corporate entities, and institutional clients in Germany, the United Kingdom, rest of Europe, the Middle East, Africa, the Americas, and the Asia-Pacific. It operates through Corporate Bank, Investment Bank, Private Bank, and Asset Management segments. The Corporate Bank segment offers cash management, trade finance and lending, trust and agency, and securities services, as well as risk management solutions. The Investment Bank segment provides debt origination, merger and acquisitions, foreign exchange, and equity advisory and origination platform services. The Private Bank segment offers payment and account services, and credit and deposit products, as well as investment advice products, such as environmental, social, and governance products. This segment also provides banking, wealth management, other financial, and postal and parcel services; and supports in planning, managing and investing wealth, financing personal and business interests, and servicing institutional and corporate needs. The Asset Management segment offers investment solutions, such as alternative investments, which include real estate, infrastructure, liquid real assets, and sustainable investments; and various other services, including insurance and pension solutions, asset liability management, portfolio management solutions, and asset allocation advisory to individuals and institutions. Deutsche Bank Aktiengesellschaft was founded in 1870 and is headquartered in Frankfurt am Main, Germany.

About MidCap Financial Investment

MidCap Financial Investment Corporation (Former name Apollo Investment Corporation) is business development company and a closed-end, externally managed, non-diversified management investment company. It is elected to be treated as a business development company (BDC) under the Investment Company Act of 1940 (the 1940 Act) specializing in private equity investments in leveraged buyouts, acquisitions, recapitalizations, growth capital, refinancing and private middle market companies. It provides direct equity capital, mezzanine, first lien secured loans, stretch senior loans, unitranche loans, second lien secured loans and senior secured loans, unsecured debt, and subordinated debt and loans. It also seeks to invest in PIPES transactions. The fund may also invest in securities of public companies that are thinly traded and may acquire investments in the secondary market and structured products. It prefers to invest in preferred equity, common equity / interests and warrants and makes equity co-investments. It may invest in cash equivalents, U.S. government securities, high-quality debt investments that mature in one year or less, high-yield bonds, distressed debt, non-U.S. investments, or securities of public companies that are not thinly traded. It also focuses on other investments such as collateralized loan obligations (CLOs) and credit-linked notes (CLNs). The fund typically invests in construction and building materials, business services, plastics & rubber, advertising, capital equipment, education, cable television, chemicals, consumer products/goods durable and non-durable and customer services, direct marketing, energy oil & gas, electricity and utilities. The fund also invest in aerospace & defense, wholesale, telecommunications, financial services, hotel, gaming, leisure, restaurants; environmental industries, healthcare and pharmaceuticals, high tech industries, beverages, food and tobacco, manufacturing, media diversified & production, printing and publishing, retail, automation, aviation and consumer transport, transportation, cargo and distribution. It primarily invests in United States. It primarily invests between $20 million and $250 million in its portfolio companies and EBITDA with less than $75 million. The fund seeks to make investments with stated maturities of five to 10 years.