Analyzing Blackrock Tcp Capital (NASDAQ:TCPC) and Investcorp Credit Management BDC (NASDAQ:ICMB)

Blackrock Tcp Capital (NASDAQ:TCPC) and Investcorp Credit Management BDC (NASDAQ:ICMB) are both small-cap finance companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, profitability, earnings, analyst recommendations, valuation, institutional ownership and risk.

Institutional & Insider Ownership

7.8% of Investcorp Credit Management BDC shares are held by institutional investors. 0.4% of Blackrock Tcp Capital shares are held by company insiders. Comparatively, 1.3% of Investcorp Credit Management BDC shares are held by company 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.

Profitability

This table compares Blackrock Tcp Capital and Investcorp Credit Management BDC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Blackrock Tcp Capital	-66.92%	14.30%	5.47%
Investcorp Credit Management BDC	-118.71%	2.26%	0.75%

Volatility and Risk

Blackrock Tcp Capital has a beta of 0.93, indicating that its stock price is 7% less volatile than the S&P 500. Comparatively, Investcorp Credit Management BDC has a beta of 0.57, indicating that its stock price is 43% less volatile than the S&P 500.

Earnings & Valuation

This table compares Blackrock Tcp Capital and Investcorp Credit Management BDC”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Blackrock Tcp Capital	$201.79 million	1.58	-$88.93 million	($1.49)	-2.54
Investcorp Credit Management BDC	$17.40 million	1.00	-$8.85 million	($1.37)	-0.88

Investcorp Credit Management BDC has lower revenue, but higher earnings than Blackrock Tcp Capital. Blackrock Tcp Capital is trading at a lower price-to-earnings ratio than Investcorp Credit Management BDC, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Blackrock Tcp Capital and Investcorp Credit Management BDC, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Blackrock Tcp Capital	3	1	0	0	1.25
Investcorp Credit Management BDC	1	0	0	0	1.00

Blackrock Tcp Capital presently has a consensus price target of $3.50, suggesting a potential downside of 7.65%. Given Blackrock Tcp Capital’s stronger consensus rating and higher probable upside, research analysts plainly believe Blackrock Tcp Capital is more favorable than Investcorp Credit Management BDC.

Summary

Blackrock Tcp Capital beats Investcorp Credit Management BDC on 8 of the 13 factors compared between the two stocks.

About Blackrock Tcp Capital

BlackRock TCP Capital Corp. is a business development company specializing in direct equity and debt investments in middle-market, small businesses, debt securities, senior secured loans, junior loans, originated loans, mezzanine, senior debt instruments, bonds, and secondary-market investments. It typically invests in communication services, public relations services, television, wireless telecommunication services, apparel, textile mills, restaurants, retailing, energy, oil and gas extraction, Patent owners and Lessors, Federal and Federally- Sponsored Credit agencies, insurance, hospital and healthcare centers, Biotechnology, engineering services, heavy electrical equipment, tax accounting, scientific and related consulting services, charter freight air transportation, Information technology consulting, application hosting services, software diagram and design, computer aided design, communication equipment, electronics manufacturing equipment, computer components, chemicals. It seeks to invest in the United States. The fund typically invests between $10 million and $35 million in companies with enterprise values between $100 million and $1500 million including complex situations. It prefers to make equity investments in companies for an ownership stake.

About Investcorp Credit Management BDC

Investcorp Credit Management BDC, Inc. is a business development company specializing in loan, mezzanine, middle market, growth capital, acquisitions, market/product expansion, organic growth, refinancings and recapitalization investments. It also selectively invests in mezzanine loans/structured equity and in the equity of portfolio companies through warrants and other instruments, in most cases taking such upside participation interests as part of a broader investment relationship. The fund typically invests in United States and Europe. Within United States, the fund seeks to invest in Midatlantic, Midwest, Northeast, Southeast, and West Coast regions. The fund primarily invests in cable and satellites; consumer services; healthcare equipment and services; industrials; information technology; telecommunication services; and utilities sectors. The fund seeks to invest between $5 million to $25 million in companies that have annual revenues of at least $50 million with EBITDA at least $15 million.