SLR Investment (NASDAQ:SLRC – Get Free Report) and Flaherty & Crumrine Preferred Income Opportunity Fund (NYSE:PFO – Get Free Report) are both small-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, institutional ownership, earnings, profitability, valuation and risk.
Profitability
This table compares SLR Investment and Flaherty & Crumrine Preferred Income Opportunity Fund’s net margins, return on equity and return on assets.
Net Margins | Return on Equity | Return on Assets | |
SLR Investment | 41.66% | 9.51% | 3.72% |
Flaherty & Crumrine Preferred Income Opportunity Fund | N/A | N/A | N/A |
Dividends
SLR Investment pays an annual dividend of $1.64 per share and has a dividend yield of 10.9%. Flaherty & Crumrine Preferred Income Opportunity Fund pays an annual dividend of $0.55 per share and has a dividend yield of 6.4%. SLR Investment pays out 92.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Analyst Ratings
Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
SLR Investment | 2 | 3 | 0 | 0 | 1.60 |
Flaherty & Crumrine Preferred Income Opportunity Fund | 0 | 0 | 0 | 0 | N/A |
SLR Investment presently has a consensus target price of $15.25, indicating a potential upside of 0.99%. Given SLR Investment’s higher probable upside, equities analysts clearly believe SLR Investment is more favorable than Flaherty & Crumrine Preferred Income Opportunity Fund.
Valuation and Earnings
This table compares SLR Investment and Flaherty & Crumrine Preferred Income Opportunity Fund’s revenue, earnings per share (EPS) and valuation.
Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
SLR Investment | $229.31 million | 3.59 | $76.39 million | $1.78 | 8.48 |
Flaherty & Crumrine Preferred Income Opportunity Fund | $20.34 million | 5.51 | N/A | N/A | N/A |
SLR Investment has higher revenue and earnings than Flaherty & Crumrine Preferred Income Opportunity Fund.
Institutional and Insider Ownership
35.3% of SLR Investment shares are owned by institutional investors. Comparatively, 12.9% of Flaherty & Crumrine Preferred Income Opportunity Fund shares are owned by institutional investors. 8.2% of SLR Investment shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Volatility and Risk
SLR Investment has a beta of 1.13, indicating that its stock price is 13% more volatile than the S&P 500. Comparatively, Flaherty & Crumrine Preferred Income Opportunity Fund has a beta of 0.88, indicating that its stock price is 12% less volatile than the S&P 500.
Summary
SLR Investment beats Flaherty & Crumrine Preferred Income Opportunity Fund on 9 of the 11 factors compared between the two stocks.
About SLR Investment
SLR Investment Corp. is a business development company specializing in secured debt (first lien unitranche and second lien), subordinated (unsecured) debt, minority equity, leveraged buyouts, acquisitions, recapitalizations, general refinancing, growth capital and strategic income-oriented control equity investments in leveraged middle market companies. The fund invests in aerospace and defense; air freight & logistics; asset management; automotive; banking; beverage, food and tobacco; building products; buildings and real estate; broadcasting and entertainment; cargo transport; commercial services and supplies; communications equipment; chemicals, plastics and rubber; containers, packaging and glass; construction & engineering; diversified/conglomerate manufacturing; consumer Finance; distributors; diversified/conglomerate services; diversified financial services; diversified real estate activities; food products; Footwear; Education Services; diversified telecommunications services; electronics; farming and agriculture; finance; grocery; health care equipment and supplies; health care facilities; education and childcare; home and office furnishing, durable consumer products; hotels, motels, inns and gaming; insurance; restaurants, leisure, amusement, and entertainment; leisure equipment tolls and services, media, multiline retail, multi sector holdings; paper and forest products; personal products; professional services, research and consulting services, software; specialty retail; textiles apparel and luxury goods, thrifts and mortgage finance, trading companies and distributors, utilities, and wireless telecommunication services; industrial conglomerates; internet software and services, IT services, machinery; mining, steel, iron, and non-precious metals; oil and gas; personal, food and miscellaneous services; printing and publishing; retail stores; telecommunications; textiles and leather; and utilities. It also invests in life sciences with focus on specialty pharmaceuticals, medical devices, biotech, health Care Providers and services; health Care technology, enabling technologies and tools. The fund primarily invests in United States. The fund's investments generally range between $5 million and $100 million. The fund invests in companies with revenues between $50 million and $1 billion and EBITDA between $15 million and $100 million. It invests in the form of senior secured loans, mezzanine loans, and equity securities. It may also seek investments in thinly traded public companies and also make secondary investments. The fund makes non-control equity investments. It primarily exits within three years of the initial capital commitment.
About Flaherty & Crumrine Preferred Income Opportunity Fund
Flaherty & Crumrine Preferred Income Opportunity Fund Inc. is a closed ended equity mutual fund launched and managed by Flaherty & Crumrine Incorporated. The fund invests in the public equity markets of the United States. It invests in stocks of companies operating in the financial services sector. The fund primarily invests in preferred securities. It benchmarks the performance of its portfolio against S&P 500 Index and Barclays Capital U.S. Aggregate Index. Flaherty & Crumrine Preferred Income Opportunity Fund Inc. was formed on December 10, 1991 and is domiciled in the United States.
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