Barings Bdc (NYSE:BBDC) vs. Eagle Point Credit (NYSE:ECC) Financial Review

Barings Bdc (NYSE:BBDC) and Eagle Point Credit (NYSE:ECC) 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, profitability, risk, institutional ownership, valuation, dividends and earnings.

Valuation & Earnings

This table compares Barings Bdc and Eagle Point Credit”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Barings Bdc	$279.21 million	3.17	$101.92 million	$0.83	10.17
Eagle Point Credit	$203.99 million	1.87	-$115.00 million	$0.61	4.73

Barings Bdc has higher revenue and earnings than Eagle Point Credit. Eagle Point Credit is trading at a lower price-to-earnings ratio than Barings Bdc, indicating that it is currently the more affordable of the two stocks.

Dividends

Barings Bdc pays an annual dividend of $1.04 per share and has a dividend yield of 12.3%. Eagle Point Credit pays an annual dividend of $1.12 per share and has a dividend yield of 38.8%. Barings Bdc pays out 125.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Eagle Point Credit pays out 183.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Barings Bdc has increased its dividend for 3 consecutive years.

Insider & Institutional Ownership

44.1% of Barings Bdc shares are owned by institutional investors. Comparatively, 19.5% of Eagle Point Credit shares are owned by institutional investors. 0.6% of Barings Bdc shares are owned by insiders. Comparatively, 0.3% of Eagle Point Credit shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Barings Bdc and Eagle Point Credit’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Barings Bdc	32.73%	10.07%	4.38%
Eagle Point Credit	-84.29%	-1.83%	-0.99%

Analyst Recommendations

This is a summary of recent recommendations for Barings Bdc and Eagle Point Credit, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Barings Bdc	0	4	1	0	2.20
Eagle Point Credit	0	2	2	0	2.50

Barings Bdc presently has a consensus price target of $9.75, indicating a potential upside of 15.45%. Eagle Point Credit has a consensus price target of $3.75, indicating a potential upside of 29.98%. Given Eagle Point Credit’s stronger consensus rating and higher probable upside, analysts plainly believe Eagle Point Credit is more favorable than Barings Bdc.

Volatility & Risk

Barings Bdc has a beta of 0.64, suggesting that its stock price is 36% less volatile than the S&P 500. Comparatively, Eagle Point Credit has a beta of 0.38, suggesting that its stock price is 62% less volatile than the S&P 500.

Summary

Barings Bdc beats Eagle Point Credit on 13 of the 17 factors compared between the two stocks.

About Barings Bdc

Barings BDC, Inc. is a publicly traded, externally managed investment company that has elected to be treated as a business development company under the Investment Company Act of 1940. It seeks to invest primarily in senior secured loans, first lien debt, unitranche, second lien debt, subordinated debt, equity co-investments and senior secured private debt investments in private middle-market companies that operate across a wide range of industries. It specializes in mezzanine, leveraged buyouts, management buyouts, ESOPs, change of control transactions, acquisition financings, growth financing, and recapitalizations in lower middle market, mature, and later stage companies. It invests in manufacturing and distribution; business services and technology; transportation and logistics; consumer product and services. It invests in United States. It invests in companies with EBITDA of $10 million to $75 million, typically in private equity sponsor backed.

About Eagle Point Credit

Eagle Point Credit Company Inc. is a closed ended fund launched and managed by Eagle Point Credit Management LLC. It invests in fixed income markets of the United States. The fund invests equity and junior debt tranches of collateralized loan obligations consisting primarily of below investment grade U.S. senior secured loans. Eagle Point Credit Company Inc. was formed on March 24, 2014 and is domiciled in the United States.