Reviewing Alaris Equity Partners Income Trust (OTCMKTS:ADLRF) and Gladstone Capital (NASDAQ:GLAD)

Alaris Equity Partners Income Trust (OTCMKTS:ADLRF) and Gladstone Capital (NASDAQ:GLAD) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, earnings, valuation, risk, profitability, institutional ownership and analyst recommendations.

Earnings and Valuation

This table compares Alaris Equity Partners Income Trust and Gladstone Capital”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alaris Equity Partners Income Trust	N/A	N/A	N/A	N/A	N/A
Gladstone Capital	$46.51 million	9.24	$58.11 million	$1.83	10.39

Gladstone Capital has higher revenue and earnings than Alaris Equity Partners Income Trust.

Insider & Institutional Ownership

10.7% of Gladstone Capital shares are owned by institutional investors. 3.8% of Gladstone Capital shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Alaris Equity Partners Income Trust and Gladstone Capital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Alaris Equity Partners Income Trust	N/A	N/A	N/A
Gladstone Capital	45.15%	9.79%	5.31%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Alaris Equity Partners Income Trust and Gladstone Capital, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alaris Equity Partners Income Trust	0	0	0	0	0.00
Gladstone Capital	0	4	2	0	2.33

Gladstone Capital has a consensus price target of $21.67, suggesting a potential upside of 13.92%. Given Gladstone Capital’s stronger consensus rating and higher probable upside, analysts plainly believe Gladstone Capital is more favorable than Alaris Equity Partners Income Trust.

Summary

Gladstone Capital beats Alaris Equity Partners Income Trust on 9 of the 9 factors compared between the two stocks.

About Alaris Equity Partners Income Trust

Alaris Equity Partners Income Trust is a private equity firm specializing in management buyouts, growth capital, lower & middle market, later stage, industry consolidation, growth capital, and mature investments. The firm does not invest in turnarounds and start-ups. It prefers to invest in the companies based in all industries except for those with a declining asset base, such as oil and gas resource companies, or any industry that carry the risk of obsolescence such as high tech and focuses on business services, professional services, information services, healthcare services, distribution & logistics, industrials, consumer products. The firm seeks to invest in companies raising capital for a partial liquidity, generational transfer, recapitalization, and growth and who do not want to give up control or chance the added risk that comes with high leverage levels. It prefers to invest in companies that are mostly individual or family controlled. The firm typically provides alternative financing for a diversified group of private businesses ("Private Company Partners") in exchange for royalties or distributions from the Private Company Partners, with the principal objective of generating stable and predictable cash flows for dividend payments to its shareholders. It seeks to invest in the companies based in Europe, North America with the focus on Canada, and United States. It typically invests between $30 million and $150 million in companies with an enterprise values between $10 million and $400 million and EBITDA between $5 million and $50 million, historical EBITDA in excess of $10 million, and Low levels of debt and capital expenditure. The firm also makes small cap investments up to $20 million in private companies that have historical EBITDA in excess of $2 million. However, for larger companies, transactions can be structured to include additional investments. The firm seeks to invest in industries that do not experience large cyclical swings. It does not own any shares and does not require board representation. The firm invests through balance sheet and seeks equity dividend distribution from portfolios. It prefers to make non control equity, minority and majority investments in its portfolio companies. Alaris Royalty Corp. was founded in 2008 and is based in Calgary, Canada.

About Gladstone Capital

Gladstone Capital Corporation is a business development company specializing in lower middle market, growth capital, add on acquisitions, change of control, buy & build strategies, debt refinancing, debt investments in senior term loans, revolving loans, secured first and second lien term loans, senior subordinated loans, unitranche loans, junior subordinated loans, and mezzanine loans and equity investments in the form of common stock, preferred stock, limited liability company interests, or warrants. It operates as a business development company. The fund also makes private equity investments in acquisitions, buyouts and recapitalizations, and refinancing existing debts. It targets small and medium-sized companies in United States. It is industry agnostic and seeks to invest in companies engaged in the business services, light and specialty manufacturing, niche industrial products and services, specialty consumer products and services, energy services, transportation and logistics, healthcare and education services, specialty chemicals, media and communications and aerospace and defense. The fund seeks to invest between $7 million and $30 million in companies that have between $20 million and $150 million in sales and EBITDA between $3 million and $25 million. It prefers to acquire minority stakes. It seeks to exit its investments through strategic acquisitions by other industry participants or financial buyers, initial public offerings of common stock, or other capital market transactions.