Crescent Capital BDC (NASDAQ:CCAP) versus Hamilton Lane (NASDAQ:HLNE) Critical Review

Crescent Capital BDC (NASDAQ:CCAP) and Hamilton Lane (NASDAQ:HLNE) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, institutional ownership, earnings and risk.

Volatility & Risk

Crescent Capital BDC has a beta of 0.52, indicating that its share price is 48% less volatile than the S&P 500. Comparatively, Hamilton Lane has a beta of 1.19, indicating that its share price is 19% more volatile than the S&P 500.

Dividends

Crescent Capital BDC pays an annual dividend of $1.36 per share and has a dividend yield of 14.2%. Hamilton Lane pays an annual dividend of $2.40 per share and has a dividend yield of 2.9%. Crescent Capital BDC pays out -1,511.1% of its earnings in the form of a dividend. Hamilton Lane pays out 36.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Crescent Capital BDC has raised its dividend for 1 consecutive years and Hamilton Lane has raised its dividend for 8 consecutive years. Crescent Capital BDC is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation & Earnings

This table compares Crescent Capital BDC and Hamilton Lane”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Crescent Capital BDC	$7.13 million	49.64	$34.51 million	($0.09)	-106.73
Hamilton Lane	$758.99 million	6.07	$249.18 million	$6.56	12.65

Hamilton Lane has higher revenue and earnings than Crescent Capital BDC. Crescent Capital BDC is trading at a lower price-to-earnings ratio than Hamilton Lane, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Crescent Capital BDC and Hamilton Lane’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Crescent Capital BDC	-2.02%	9.02%	3.82%
Hamilton Lane	32.14%	25.10%	15.75%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Crescent Capital BDC and Hamilton Lane, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Crescent Capital BDC	0	6	1	0	2.14
Hamilton Lane	0	2	6	1	2.89

Crescent Capital BDC currently has a consensus target price of $12.62, indicating a potential upside of 31.43%. Hamilton Lane has a consensus target price of $131.57, indicating a potential upside of 58.52%. Given Hamilton Lane’s stronger consensus rating and higher probable upside, analysts clearly believe Hamilton Lane is more favorable than Crescent Capital BDC.

Insider & Institutional Ownership

49.5% of Crescent Capital BDC shares are owned by institutional investors. Comparatively, 97.4% of Hamilton Lane shares are owned by institutional investors. 1.2% of Crescent Capital BDC shares are owned by company insiders. Comparatively, 24.0% of Hamilton Lane shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Hamilton Lane beats Crescent Capital BDC on 15 of the 18 factors compared between the two stocks.

About Crescent Capital BDC

Crescent Capital BDC, Inc. is as a business development company private equity / buyouts and loan fund. It specializes in directly investing. It specializes in middle market. The fund seeks to invest in United States.

About Hamilton Lane

Hamilton Lane Incorporated is a private equity firm specializing in early venture, emerging growth, turnaround, middle market, mature, mid-venture, bridge, buyout, distressed/vulture, loan, mezzanine in growth capital companies. It prefers to invest in energy, industrials, consumer discretionary, health care, real estate, information technology, utilities, and consumer services. The firm prefers to invest in Africa/Middle East, Asia/Pacific, Europe, Latin America and Caribbean, United States of America, and Canada. The firm prefers to invest between $1 million and $100 million. It prefers to take majority stake. Hamilton Lane Incorporated was founded in 1991 and is based in Conshohocken, Pennsylvania with additional offices across Europe, North America, Asia Pacific and the Middle East.