Head-To-Head Review: DNP Select Income Fund (NYSE:DNP) versus Compass Diversified (NYSE:CODI)

DNP Select Income Fund (NYSE:DNP) and Compass Diversified (NYSE:CODI) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, dividends, risk, profitability and institutional ownership.

Analyst Ratings

This is a summary of recent recommendations for DNP Select Income Fund and Compass Diversified, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DNP Select Income Fund	0	0	0	0	0.00
Compass Diversified	1	3	1	0	2.00

Compass Diversified has a consensus price target of $12.75, suggesting a potential upside of 10.50%. Given Compass Diversified’s stronger consensus rating and higher probable upside, analysts plainly believe Compass Diversified is more favorable than DNP Select Income Fund.

Profitability

This table compares DNP Select Income Fund and Compass Diversified’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DNP Select Income Fund	N/A	N/A	N/A
Compass Diversified	-12.30%	-9.53%	0.06%

Earnings & Valuation

This table compares DNP Select Income Fund and Compass Diversified”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DNP Select Income Fund	N/A	N/A	N/A	N/A	N/A
Compass Diversified	$1.87 billion	0.46	-$226.41 million	($3.91)	-2.95

DNP Select Income Fund has higher earnings, but lower revenue than Compass Diversified.

Insider & Institutional Ownership

8.5% of DNP Select Income Fund shares are owned by institutional investors. Comparatively, 72.7% of Compass Diversified shares are owned by institutional investors. 0.0% of DNP Select Income Fund shares are owned by company insiders. Comparatively, 1.6% of Compass Diversified shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Risk & Volatility

DNP Select Income Fund has a beta of 0.34, meaning that its share price is 66% less volatile than the S&P 500. Comparatively, Compass Diversified has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500.

Summary

Compass Diversified beats DNP Select Income Fund on 8 of the 10 factors compared between the two stocks.

About DNP Select Income Fund

DNP Select Income Fund Inc. is a closed ended balanced mutual fund launched by Virtus Investment Partners, Inc. The fund is managed by Duff & Phelps Investment Management Co. It invests in the public equity and fixed income markets of the United States. For the fixed income portion, the fund invests in bonds. It seeks to invest in stocks of companies operating in the Utility sector. The fund invests in stocks of companies across all market capitalizations. It benchmarks the performance of its portfolio against the S&P 500 Utilities Index and Barclays Capital U.S. Utility Bond Index. DNP Select Income Fund Inc. was formed on November 26, 1986 and is domiciled in the United States.

About Compass Diversified

Compass Diversified is a private equity firm specializing in add on acquisitions, buyouts, industry consolidation, recapitalization, late stage and middle market investments. It seeks to invest in niche industrial or branded consumer companies, manufacturing, distribution, consumer products, business services sector, healthcare, safety & security, electronic components, food and foodservice. The firm prefers to invest in companies based in North America. It seeks to invest between $100 million and $800 million in companies with an EBITDA between $15 million to $80 million. It seeks to acquire controlling ownership interests in its portfolio companies and can make additional platform acquisitions. The firm prefer to have majority stake in companies. The firm invests through its balance sheet and typically holds investments between five to seven years. Compass Diversified was founded in 2006 and is based in Westport, Connecticut with an additional office in Costa Mesa, California.