Cannae (NYSE: CNNE) and Capital Southwest (NASDAQ:CSWC) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, analyst recommendations, risk, earnings and profitability.
Institutional & Insider Ownership
76.7% of Cannae shares are owned by institutional investors. Comparatively, 59.6% of Capital Southwest shares are owned by institutional investors. 6.0% of Cannae shares are owned by insiders. Comparatively, 5.9% of Capital Southwest shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
This is a summary of recent ratings for Cannae and Capital Southwest, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Capital Southwest has a consensus target price of $20.00, suggesting a potential upside of 15.41%. Given Capital Southwest’s higher probable upside, analysts plainly believe Capital Southwest is more favorable than Cannae.
Volatility and Risk
Cannae has a beta of 0.76, meaning that its stock price is 24% less volatile than the S&P 500. Comparatively, Capital Southwest has a beta of -0.64, meaning that its stock price is 164% less volatile than the S&P 500.
Capital Southwest pays an annual dividend of $1.04 per share and has a dividend yield of 6.0%. Cannae does not pay a dividend. Capital Southwest pays out 55.3% of its earnings in the form of a dividend.
Earnings and Valuation
This table compares Cannae and Capital Southwest’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Cannae||$1.34 billion||0.96||$650.00 million||$1.62||11.23|
|Capital Southwest||$23.50 million||11.94||$23.47 million||$1.88||9.22|
Cannae has higher revenue and earnings than Capital Southwest. Capital Southwest is trading at a lower price-to-earnings ratio than Cannae, indicating that it is currently the more affordable of the two stocks.
This table compares Cannae and Capital Southwest’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Capital Southwest beats Cannae on 8 of the 15 factors compared between the two stocks.
Cannae Company Profile
Cannae Holdings, Inc. is a diversified holding company. The Company has investments in a variety of industries including Restaurants, Technology Enabled Healthcare Services, Financial Services and more. The Company holds majority and minority equity investment stakes in a number of entities, including Ceridian Holdings, LLC, American Blue Ribbon Holdings, and LLC and T-System Holding LLC.
Capital Southwest Company Profile
Capital Southwest Corporation is an investment company that specializes in providing customized financing to middle market companies in a range of industry segments located primarily in the United States. The Company is a specialty lending company. Its principal investment objective is to produce risk-adjusted returns by generating current income from debt investments and capital appreciation from its equity and equity related investments. It focuses on partnering with business owners, management teams and financial sponsors to provide financing solutions to fund growth, changes of control, or other corporate events. In allocating future investments, it focuses on investing in senior and subordinated debt securities secured by security interests in portfolio company assets, coupled with equity interests. It targets senior and subordinated investments in the lower middle market and private loan transactions, as well as first and second lien syndicated loans in middle market companies.
Receive News & Ratings for Cannae Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Cannae and related companies with MarketBeat.com's FREE daily email newsletter.