Financial Analysis: Main Street Capital Corporation (MAIN) vs. Intercontinental Exchange (ICE)
Intercontinental Exchange (NYSE: ICE) and Main Street Capital Corporation (NYSE:MAIN) are both mid-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, analyst recommendations, risk, dividends, institutional ownership and profitabiliy.
This is a summary of current ratings and recommmendations for Intercontinental Exchange and Main Street Capital Corporation, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Main Street Capital Corporation||3||2||2||0||1.86|
Intercontinental Exchange currently has a consensus price target of $66.13, suggesting a potential upside of 0.88%. Main Street Capital Corporation has a consensus price target of $37.00, suggesting a potential downside of 4.34%. Given Intercontinental Exchange’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Intercontinental Exchange is more favorable than Main Street Capital Corporation.
Earnings & Valuation
This table compares Intercontinental Exchange and Main Street Capital Corporation’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Intercontinental Exchange||$4.51 billion||8.61||$2.74 billion||$2.60||25.23|
|Main Street Capital Corporation||$184.22 million||11.74||$161.62 million||$2.89||13.38|
Intercontinental Exchange has higher revenue and earnings than Main Street Capital Corporation. Main Street Capital Corporation is trading at a lower price-to-earnings ratio than Intercontinental Exchange, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Intercontinental Exchange has a beta of 0.71, indicating that its stock price is 29% less volatile than the S&P 500. Comparatively, Main Street Capital Corporation has a beta of 1.05, indicating that its stock price is 5% more volatile than the S&P 500.
This table compares Intercontinental Exchange and Main Street Capital Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Main Street Capital Corporation||83.34%||10.01%||5.83%|
Insider & Institutional Ownership
89.4% of Intercontinental Exchange shares are held by institutional investors. Comparatively, 27.1% of Main Street Capital Corporation shares are held by institutional investors. 1.5% of Intercontinental Exchange shares are held by company insiders. Comparatively, 5.6% of Main Street Capital Corporation shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Intercontinental Exchange pays an annual dividend of $0.80 per share and has a dividend yield of 1.2%. Main Street Capital Corporation pays an annual dividend of $2.22 per share and has a dividend yield of 5.7%. Intercontinental Exchange pays out 30.8% of its earnings in the form of a dividend. Main Street Capital Corporation pays out 76.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Intercontinental Exchange has raised its dividend for 6 consecutive years and Main Street Capital Corporation has raised its dividend for 3 consecutive years.
Intercontinental Exchange beats Main Street Capital Corporation on 10 of the 17 factors compared between the two stocks.
About Intercontinental Exchange
Intercontinental Exchange Inc, formerly IntercontinentalExchange Group, Inc., is a network of regulated exchanges and clearing houses for financial and commodity markets. The Company delivers transparent and accessible data, technology and risk management services to markets around the world through its portfolio of exchanges, including the New York Stock Exchange, ICE Futures, Liffe and Euronext. In February 2014, the Company completed the acquisition of Singapore Mercantile Exchange. In July 2014, Intercontinental Exchange Inc sold its Wombat Financial Software, a unit of NYSE Technologies. Effective September 10, 2014, Intercontinental Exchange Inc acquired an undisclosed majority interest in Holland Clearing House NV.
About Main Street Capital Corporation
Main Street Capital Corporation (MSCC) is a principal investment firm. MSCC’s principal investment objective is to maximize its portfolio’s total return by generating current income from the Company’s debt investments and capital appreciation from its equity and equity related investments, including warrants, convertible securities and other rights to acquire equity securities in a portfolio company. It is primarily focused on providing customized debt and equity financing to lower middle market (LMM) companies and debt capital to middle market (Middle Market) companies. It invests primarily in secured debt investments, equity investments, warrants and other securities of LMM companies and in secured debt investments of Middle Market companies. Its investment portfolio includes its investments in LMM portfolio companies, investments in Middle Market portfolio companies and Other Portfolio investments, among others. MSC Adviser I, LLC is the External Investment Manager.
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