PennantPark Floating Rate Capital (NASDAQ:PFLT) and Fairfax India (OTCMKTS:FFXDF) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, valuation, institutional ownership, risk, dividends, earnings and analyst recommendations.
Earnings and Valuation
This table compares PennantPark Floating Rate Capital and Fairfax India's gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
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PennantPark Floating Rate Capital | $95.49 million | 5.13 | $18.41 million | $1.12 | 11.29 |
Fairfax India | $712.69 million | 2.74 | $516.34 million | N/A | N/A |
Fairfax India has higher revenue and earnings than PennantPark Floating Rate Capital.
Insider and Institutional Ownership
29.3% of PennantPark Floating Rate Capital shares are held by institutional investors. Comparatively, 0.1% of Fairfax India shares are held by institutional investors. 2.0% of PennantPark Floating Rate Capital shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Volatility and Risk
PennantPark Floating Rate Capital has a beta of 1.97, indicating that its stock price is 97% more volatile than the S&P 500. Comparatively, Fairfax India has a beta of 1.19, indicating that its stock price is 19% more volatile than the S&P 500.
Profitability
This table compares PennantPark Floating Rate Capital and Fairfax India's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
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PennantPark Floating Rate Capital | 19.28% | 9.04% | 3.59% |
Fairfax India | N/A | -3.61% | -2.85% |
Analyst Ratings
This is a summary of current ratings and recommmendations for PennantPark Floating Rate Capital and Fairfax India, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
PennantPark Floating Rate Capital | 0 | 1 | 2 | 0 | 2.67 |
Fairfax India | 0 | 0 | 1 | 0 | 3.00 |
PennantPark Floating Rate Capital presently has a consensus price target of $10.50, indicating a potential downside of 16.93%. Given Fairfax India's stronger consensus rating and higher possible upside, analysts clearly believe Fairfax India is more favorable than PennantPark Floating Rate Capital.
Summary
PennantPark Floating Rate Capital beats Fairfax India on 8 of the 13 factors compared between the two stocks.