MSCI (NYSE:MSCI) & Golub Capital BDC (NASDAQ:GBDC) Head to Head Analysis

Golub Capital BDC (NASDAQ:GBDC) and MSCI (NYSE:MSCI) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, valuation, institutional ownership, earnings, analyst recommendations, risk and profitability.

Risk & Volatility

Golub Capital BDC has a beta of 0.39, meaning that its stock price is 61% less volatile than the S&P 500. Comparatively, MSCI has a beta of 1.22, meaning that its stock price is 22% more volatile than the S&P 500.

Profitability

This table compares Golub Capital BDC and MSCI’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Golub Capital BDC	21.45%	9.91%	4.39%
MSCI	40.74%	-55.19%	24.90%

Institutional & Insider Ownership

42.4% of Golub Capital BDC shares are held by institutional investors. Comparatively, 90.0% of MSCI shares are held by institutional investors. 1.4% of Golub Capital BDC shares are held by company insiders. Comparatively, 3.8% of MSCI shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Dividends

Golub Capital BDC pays an annual dividend of $1.32 per share and has a dividend yield of 10.5%. MSCI pays an annual dividend of $8.20 per share and has a dividend yield of 1.5%. Golub Capital BDC pays out 203.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. MSCI pays out 44.9% of its earnings in the form of a dividend. MSCI has increased its dividend for 11 consecutive years.

Earnings and Valuation

This table compares Golub Capital BDC and MSCI”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Golub Capital BDC	$870.78 million	3.74	$376.65 million	$0.65	19.28
MSCI	$3.13 billion	12.74	$1.20 billion	$18.28	30.06

MSCI has higher revenue and earnings than Golub Capital BDC. Golub Capital BDC is trading at a lower price-to-earnings ratio than MSCI, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Golub Capital BDC and MSCI, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Golub Capital BDC	0	2	4	1	2.86
MSCI	0	0	11	1	3.08

Golub Capital BDC presently has a consensus target price of $13.90, suggesting a potential upside of 10.93%. MSCI has a consensus target price of $709.50, suggesting a potential upside of 29.12%. Given MSCI’s stronger consensus rating and higher probable upside, analysts plainly believe MSCI is more favorable than Golub Capital BDC.

Summary

MSCI beats Golub Capital BDC on 15 of the 17 factors compared between the two stocks.

About Golub Capital BDC

Golub Capital BDC, Inc. (GBDC) is a business development company and operates as an externally managed closed-end non-diversified management investment company. It invests in debt and minority equity investments in middle-market companies that are, in most cases, sponsored by private equity investors. It typically invests in diversified consumer services, automobiles, healthcare technology, insurance, health care equipment and supplies, hotels, restaurants and leisure, healthcare providers and services, IT services and specialty retails. It seeks to invest in the United States. It primarily invests in first lien traditional senior debt, first lien one stop, junior debt and equity, senior secured, one stop, unitranche, second lien, subordinated and mezzanine loans of middle-market companies, and warrants.

About MSCI

MSCI Inc., together with its subsidiaries, provides critical decision support tools and solutions for the investment community to manage investment processes worldwide. The Index segment provides indexes for use in various areas of the investment process, including indexed financial product, such as ETFs, mutual funds, annuities, futures, options, structured products, and over-the-counter derivatives; performance benchmarking; portfolio construction and rebalancing; and asset allocation, as well as licenses GICS and GICS Direct. The Analytics segment offers risk management, performance attribution and portfolio management content, application, an integrated view of risk and return service, and an analysis of market, credit, liquidity, counterparty, and climate risk across asset classes; managed services, including consolidation of client portfolio data, review and reconciliation of input data and results, and customized reporting; and HedgePlatform to measure, evaluate, and monitor the risk of hedge fund investments. The ESG and Climate segment provides products and services that help institutional investors understand how ESG impacts the long-term risk and return of their portfolio and individual security-level investments; and data, ratings, research, and tools to help investors navigate increasing regulation. The All Other Private Assets segment includes real estate and infrastructure data, benchmarks, return-analytics, climate assessments and market insights; business intelligence to real estate owners, managers, developers, and brokers; and offers investment decision support tools for private capital. The Private Capital Solutions segment offers tools to help private asset investors across mission-critical workflows, such as sourcing terms and conditions, evaluating operating performance, managing risk and other activities supporting private capital investing. MSCI Inc. was incorporated in 1998 and is headquartered in New York, New York.