Financial Comparison: Piper Sandler Companies (NYSE:PIPR) and Eagle Point Credit (NYSE:ECC)

Piper Sandler Companies (NYSE:PIPR) and Eagle Point Credit (NYSE:ECC) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, profitability, institutional ownership, earnings, valuation, dividends and analyst recommendations.

Institutional & Insider Ownership

72.8% of Piper Sandler Companies shares are held by institutional investors. Comparatively, 19.5% of Eagle Point Credit shares are held by institutional investors. 3.1% of Piper Sandler Companies shares are held by insiders. Comparatively, 0.3% of Eagle Point Credit shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Risk & Volatility

Piper Sandler Companies has a beta of 1.43, indicating that its stock price is 43% more volatile than the S&P 500. Comparatively, Eagle Point Credit has a beta of 0.38, indicating that its stock price is 62% less volatile than the S&P 500.

Profitability

This table compares Piper Sandler Companies and Eagle Point Credit’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Piper Sandler Companies	14.51%	21.92%	14.60%
Eagle Point Credit	-84.29%	-1.83%	-0.99%

Earnings & Valuation

This table compares Piper Sandler Companies and Eagle Point Credit”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Piper Sandler Companies	$1.90 billion	2.37	$281.33 million	$4.32	14.79
Eagle Point Credit	$203.99 million	1.87	-$115.00 million	$0.61	4.73

Piper Sandler Companies has higher revenue and earnings than Eagle Point Credit. Eagle Point Credit is trading at a lower price-to-earnings ratio than Piper Sandler Companies, indicating that it is currently the more affordable of the two stocks.

Dividends

Piper Sandler Companies pays an annual dividend of $0.80 per share and has a dividend yield of 1.3%. Eagle Point Credit pays an annual dividend of $1.20 per share and has a dividend yield of 41.6%. Piper Sandler Companies pays out 18.5% of its earnings in the form of a dividend. Eagle Point Credit pays out 196.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Piper Sandler Companies has raised its dividend for 1 consecutive years.

Analyst Recommendations

This is a summary of recent ratings and price targets for Piper Sandler Companies and Eagle Point Credit, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Piper Sandler Companies	1	2	3	0	2.33
Eagle Point Credit	0	2	2	0	2.50

Piper Sandler Companies currently has a consensus price target of $90.81, suggesting a potential upside of 42.17%. Eagle Point Credit has a consensus price target of $4.62, suggesting a potential upside of 60.31%. Given Eagle Point Credit’s stronger consensus rating and higher probable upside, analysts clearly believe Eagle Point Credit is more favorable than Piper Sandler Companies.

Summary

Piper Sandler Companies beats Eagle Point Credit on 14 of the 17 factors compared between the two stocks.

About Piper Sandler Companies

Piper Sandler Companies operates as an investment bank and institutional securities firm that serves corporations, private equity groups, public entities, non-profit entities, and institutional investors in the United States and internationally. The company offers investment banking and institutional sales, trading, and research services for various equity and fixed income products. It provides advisory services, such as mergers and acquisitions, equity private placements, and debt and restructuring advisory; raises capital through equity and debt financings; underwrites municipal issuances; and offers municipal financial advisory and loan placement services, as well as various over-the-counter derivative products. The company also offers public finance investment banking services that focus on state and local governments, and cultural and social service non-profit entities, as well as the education, healthcare, hospitality, senior living, and transportation sectors. In addition, it provides equity and fixed income advisory and trade execution services for institutional investors, and government and non-profit entities. Further, the company is involved in the alternative asset management funds merchant banking and healthcare to invest firm capital and to manage capital from outside investors, as well as trading activities. The company was formerly known as Piper Jaffray Companies and changed its name to Piper Sandler Companies in January 2020. Piper Sandler Companies was founded in 1895 and is headquartered in Minneapolis, Minnesota.

About Eagle Point Credit

Eagle Point Credit Company Inc. is a closed ended fund launched and managed by Eagle Point Credit Management LLC. It invests in fixed income markets of the United States. The fund invests equity and junior debt tranches of collateralized loan obligations consisting primarily of below investment grade U.S. senior secured loans. Eagle Point Credit Company Inc. was formed on March 24, 2014 and is domiciled in the United States.