Carlyle Secured Lending (NASDAQ:CGBD) versus SLR Investment (NASDAQ:SLRC) Head to Head Analysis

SLR Investment (NASDAQ:SLRC) and Carlyle Secured Lending (NASDAQ:CGBD) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, earnings, institutional ownership, profitability, dividends, analyst recommendations and valuation.

Volatility and Risk

SLR Investment has a beta of 0.64, indicating that its stock price is 36% less volatile than the S&P 500. Comparatively, Carlyle Secured Lending has a beta of 0.62, indicating that its stock price is 38% less volatile than the S&P 500.

Earnings and Valuation

This table compares SLR Investment and Carlyle Secured Lending”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SLR Investment	$218.54 million	3.15	$92.54 million	$1.64	7.68
Carlyle Secured Lending	$255.57 million	2.83	$69.97 million	$0.71	14.63

SLR Investment has higher earnings, but lower revenue than Carlyle Secured Lending. SLR Investment is trading at a lower price-to-earnings ratio than Carlyle Secured Lending, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares SLR Investment and Carlyle Secured Lending’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SLR Investment	41.81%	8.33%	3.25%
Carlyle Secured Lending	19.52%	8.99%	4.01%

Analyst Recommendations

This is a summary of recent ratings and target prices for SLR Investment and Carlyle Secured Lending, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SLR Investment	3	2	2	0	1.86
Carlyle Secured Lending	0	4	3	0	2.43

SLR Investment currently has a consensus target price of $14.10, suggesting a potential upside of 11.90%. Carlyle Secured Lending has a consensus target price of $12.50, suggesting a potential upside of 20.31%. Given Carlyle Secured Lending’s stronger consensus rating and higher possible upside, analysts clearly believe Carlyle Secured Lending is more favorable than SLR Investment.

Insider & Institutional Ownership

35.3% of SLR Investment shares are held by institutional investors. Comparatively, 24.5% of Carlyle Secured Lending shares are held by institutional investors. 8.8% of SLR Investment shares are held by company insiders. Comparatively, 0.3% of Carlyle Secured Lending shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Dividends

SLR Investment pays an annual dividend of $1.24 per share and has a dividend yield of 9.8%. Carlyle Secured Lending pays an annual dividend of $1.40 per share and has a dividend yield of 13.5%. SLR Investment pays out 75.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Carlyle Secured Lending pays out 197.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

About SLR Investment

SLR Investment Corp. is a business development company specializing in secured debt (first lien unitranche and second lien), subordinated (unsecured) debt, minority equity, leveraged buyouts, acquisitions, recapitalizations, general refinancing, growth capital and strategic income-oriented control equity investments in leveraged middle market companies. The fund invests in aerospace and defense; air freight & logistics; asset management; automotive; banking; beverage, food and tobacco; building products; buildings and real estate; broadcasting and entertainment; cargo transport; commercial services and supplies; communications equipment; chemicals, plastics and rubber; containers, packaging and glass; construction & engineering; diversified/conglomerate manufacturing; consumer Finance; distributors; diversified/conglomerate services; diversified financial services; diversified real estate activities; food products; Footwear; Education Services; diversified telecommunications services; electronics; farming and agriculture; finance; grocery; health care equipment and supplies; health care facilities; education and childcare; home and office furnishing, durable consumer products; hotels, motels, inns and gaming; insurance; restaurants, leisure, amusement, and entertainment; leisure equipment tolls and services, media, multiline retail, multi sector holdings; paper and forest products; personal products; professional services, research and consulting services, software; specialty retail; textiles apparel and luxury goods, thrifts and mortgage finance, trading companies and distributors, utilities, and wireless telecommunication services; industrial conglomerates; internet software and services, IT services, machinery; mining, steel, iron, and non-precious metals; oil and gas; personal, food and miscellaneous services; printing and publishing; retail stores; telecommunications; textiles and leather; and utilities. It also invests in life sciences with focus on specialty pharmaceuticals, medical devices, biotech, health Care Providers and services; health Care technology, enabling technologies and tools. The fund primarily invests in United States. The fund’s investments generally range between $5 million and $100 million. The fund invests in companies with revenues between $50 million and $1 billion and EBITDA between $15 million and $100 million. It invests in the form of senior secured loans, mezzanine loans, and equity securities. It may also seek investments in thinly traded public companies and also make secondary investments. The fund makes non-control equity investments. It primarily exits within three years of the initial capital commitment.

About Carlyle Secured Lending

Carlyle Secured Lending, Inc. is business development company specializing in first lien debt, senior secured loans, second lien senior secured loan unsecured debt, mezzanine debt and investments in equities. It specializes in directly investing. It specializes in middle market. It targets healthcare and pharmaceutical, aerospace and defense, high tech industries, business services, software, beverage food and tobacco, hotel gamming and leisure, banking finance insurance and in real estate sector. The fund seeks to invest across United States of America, Luxembourg, Cayman Islands, Cyprus, and United Kingdom. It invests in companies with EBITDA between $25 million and $100 million.