Heritage Insurance (NYSE:HRTG) and BlackRock TCP Capital (NASDAQ:TCPC) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, earnings, analyst recommendations, dividends, profitability, institutional ownership and valuation.
Institutional and Insider Ownership
68.0% of Heritage Insurance shares are owned by institutional investors. Comparatively, 29.0% of BlackRock TCP Capital shares are owned by institutional investors. 12.0% of Heritage Insurance shares are owned by company insiders. Comparatively, 0.7% of BlackRock TCP Capital shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Risk & Volatility
Heritage Insurance has a beta of 0.67, meaning that its share price is 33% less volatile than the S&P 500. Comparatively, BlackRock TCP Capital has a beta of 1.65, meaning that its share price is 65% more volatile than the S&P 500.
Profitability
This table compares Heritage Insurance and BlackRock TCP Capital's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
Heritage Insurance | 3.38% | 4.29% | 0.95% |
BlackRock TCP Capital | 12.56% | 11.83% | 5.09% |
Analyst Recommendations
This is a breakdown of recent ratings and recommmendations for Heritage Insurance and BlackRock TCP Capital, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
Heritage Insurance | 0 | 0 | 1 | 0 | 3.00 |
BlackRock TCP Capital | 0 | 1 | 3 | 0 | 2.75 |
Heritage Insurance currently has a consensus target price of $14.00, indicating a potential upside of 28.56%. BlackRock TCP Capital has a consensus target price of $13.00, indicating a potential downside of 10.96%. Given Heritage Insurance's stronger consensus rating and higher possible upside, equities analysts plainly believe Heritage Insurance is more favorable than BlackRock TCP Capital.
Dividends
Heritage Insurance pays an annual dividend of $0.24 per share and has a dividend yield of 2.2%. BlackRock TCP Capital pays an annual dividend of $1.20 per share and has a dividend yield of 8.2%. Heritage Insurance pays out 25.3% of its earnings in the form of a dividend. BlackRock TCP Capital pays out 74.5% 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. Heritage Insurance has raised its dividend for 1 consecutive years.
Valuation and Earnings
This table compares Heritage Insurance and BlackRock TCP Capital's revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
Heritage Insurance | $511.30 million | 0.60 | $28.64 million | $0.95 | 11.46 |
BlackRock TCP Capital | $195.17 million | 4.32 | $30.58 million | $1.61 | 9.07 |
BlackRock TCP Capital has lower revenue, but higher earnings than Heritage Insurance. BlackRock TCP Capital is trading at a lower price-to-earnings ratio than Heritage Insurance, indicating that it is currently the more affordable of the two stocks.
Summary
BlackRock TCP Capital beats Heritage Insurance on 10 of the 17 factors compared between the two stocks.