Gladstone Capital Corporation (NASDAQ: GLAD) and MFS Charter Income Trust (NYSE:MCR) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, dividends, valuation, risk, analyst recommendations, earnings and profitability.
This table compares Gladstone Capital Corporation and MFS Charter Income Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Gladstone Capital Corporation||85.01%||9.88%||6.26%|
|MFS Charter Income Trust||N/A||N/A||N/A|
Institutional and Insider Ownership
14.5% of Gladstone Capital Corporation shares are owned by institutional investors. 6.5% of Gladstone Capital Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Gladstone Capital Corporation pays an annual dividend of $0.84 per share and has a dividend yield of 9.1%. MFS Charter Income Trust does not pay a dividend. Gladstone Capital Corporation pays out 62.2% of its earnings in the form of a dividend.
Earnings & Valuation
This table compares Gladstone Capital Corporation and MFS Charter Income Trust’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Gladstone Capital Corporation||N/A||N/A||N/A||$1.35||6.82|
|MFS Charter Income Trust||N/A||N/A||N/A||N/A||N/A|
This is a summary of recent ratings for Gladstone Capital Corporation and MFS Charter Income Trust, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Gladstone Capital Corporation||1||1||1||0||2.00|
|MFS Charter Income Trust||0||0||0||0||N/A|
Gladstone Capital Corporation currently has a consensus target price of $9.08, suggesting a potential downside of 1.38%. Given Gladstone Capital Corporation’s higher possible upside, analysts plainly believe Gladstone Capital Corporation is more favorable than MFS Charter Income Trust.
Gladstone Capital Corporation beats MFS Charter Income Trust on 8 of the 9 factors compared between the two stocks.
About Gladstone Capital Corporation
Gladstone Capital Corporation is a closed-end, non-diversified management investment company, operating as a business development company (BDC). The objectives of the Company are to achieve and grow current income by investing in debt securities of established businesses that it believes will provide stable earnings and cash flow to pay expenses, make principal and interest payments on its outstanding indebtedness and make distributions to stockholders that grow over time, and to provide its stockholders with long-term capital appreciation in the value of its assets by investing in equity securities of established businesses that it believes can grow over time to permit it to sell its equity investments for capital gains. The Company is focused on investing in lower middle-market companies in the United States. It has investments in south, Midwest, west and northeast of the United States. Its portfolio allocation includes debt investments and equity investments.
About MFS Charter Income Trust
MFS Charter Income Trust (Fund) is a diversified closed-end management investment company. The Fund’s investment objective is to seek high current income, but may also consider capital appreciation. The Fund normally invests in debt instruments. The Fund also invests in corporate bonds of the United States and/or foreign issuers, the United States Government securities, foreign government securities, mortgage-backed and other asset-backed securities and/or debt instruments of issuers located in emerging market countries. The Fund’s portfolio comprises bonds, floating rate loans, equities, cash and cash equivalent and other. It invests in a range of Fixed income sectors, such as high yield corporates non-united states government bonds, investment grade corporates, emerging markets bonds, commercial mortgage-backed securities, asset-backed securities and collateralized debt obligations. Massachusetts Financial Services Company is the Fund’s investment advisor.
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