Critical Comparison: Kayne Anderson BDC (KBDC) vs. The Competition

Kayne Anderson BDC (NYSE:KBDC) is one of 32 public companies in the “FIN – SBIC&COMMRL” industry, but how does it compare to its rivals? We will compare Kayne Anderson BDC to related companies based on the strength of its profitability, analyst recommendations, institutional ownership, valuation, risk, dividends and earnings.

Profitability

This table compares Kayne Anderson BDC and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kayne Anderson BDC	56.97%	11.36%	6.51%
Kayne Anderson BDC Competitors	29.58%	11.06%	4.69%

Insider & Institutional Ownership

25.5% of shares of all “FIN – SBIC&COMMRL” companies are held by institutional investors. 3.2% of Kayne Anderson BDC shares are held by insiders. Comparatively, 4.6% of shares of all “FIN – SBIC&COMMRL” companies are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Dividends

Kayne Anderson BDC pays an annual dividend of $1.60 per share and has a dividend yield of 10.2%. Kayne Anderson BDC pays out 88.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “FIN – SBIC&COMMRL” companies pay a dividend yield of 10.2% and pay out 118.7% of their earnings in the form of a dividend. Kayne Anderson BDC is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Earnings & Valuation

This table compares Kayne Anderson BDC and its rivals gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Kayne Anderson BDC	$213.11 million	$131.94 million	8.68
Kayne Anderson BDC Competitors	$306.47 million	$121.82 million	7.17

Kayne Anderson BDC’s rivals have higher revenue, but lower earnings than Kayne Anderson BDC. Kayne Anderson BDC is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Analyst Ratings

This is a breakdown of current recommendations for Kayne Anderson BDC and its rivals, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kayne Anderson BDC	0	2	2	0	2.50
Kayne Anderson BDC Competitors	183	1041	1018	16	2.38

Kayne Anderson BDC currently has a consensus target price of $16.38, indicating a potential upside of 4.83%. As a group, “FIN – SBIC&COMMRL” companies have a potential upside of 5.16%. Given Kayne Anderson BDC’s rivals higher probable upside, analysts clearly believe Kayne Anderson BDC has less favorable growth aspects than its rivals.

Summary

Kayne Anderson BDC beats its rivals on 9 of the 14 factors compared.

About Kayne Anderson BDC

Kayne Anderson BDC Inc. is a business development company which invests primarily in first lien senior secured loans, with a secondary focus on unitranche and split-lien loans to middle market companies. Kayne Anderson BDC Inc. is based in CHICAGO.