Critical Survey: W. R. Berkley (NYSE:WRB) versus BlackRock TCP Capital (NYSE:TCPC)
W. R. Berkley (NYSE:WRB) and BlackRock TCP Capital (NASDAQ:TCPC) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitability, dividends, valuation, institutional ownership and earnings.
Volatility and Risk
W. R. Berkley has a beta of 0.73, meaning that its share price is 27% less volatile than the S&P 500. Comparatively, BlackRock TCP Capital has a beta of 0.71, meaning that its share price is 29% less volatile than the S&P 500.
This is a summary of recent recommendations and price targets for W. R. Berkley and BlackRock TCP Capital, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|W. R. Berkley||2||3||1||0||1.83|
|BlackRock TCP Capital||0||0||4||0||3.00|
W. R. Berkley presently has a consensus target price of $57.81, indicating a potential downside of 14.31%. BlackRock TCP Capital has a consensus target price of $16.88, indicating a potential upside of 18.59%. Given BlackRock TCP Capital’s stronger consensus rating and higher probable upside, analysts clearly believe BlackRock TCP Capital is more favorable than W. R. Berkley.
Insider and Institutional Ownership
72.6% of W. R. Berkley shares are held by institutional investors. Comparatively, 42.8% of BlackRock TCP Capital shares are held by institutional investors. 21.7% of W. R. Berkley shares are held by insiders. Comparatively, 0.6% of BlackRock TCP Capital shares are held by 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.
W. R. Berkley pays an annual dividend of $0.44 per share and has a dividend yield of 0.7%. BlackRock TCP Capital pays an annual dividend of $1.44 per share and has a dividend yield of 10.1%. W. R. Berkley pays out 16.5% of its earnings in the form of a dividend. BlackRock TCP Capital pays out 90.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. W. R. Berkley has raised its dividend for 9 consecutive years.
Valuation & Earnings
This table compares W. R. Berkley and BlackRock TCP Capital’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|W. R. Berkley||$7.69 billion||1.61||$640.75 million||$2.67||25.27|
|BlackRock TCP Capital||$190.50 million||4.39||$45.48 million||$1.59||8.95|
W. R. Berkley has higher revenue and earnings than BlackRock TCP Capital. BlackRock TCP Capital is trading at a lower price-to-earnings ratio than W. R. Berkley, indicating that it is currently the more affordable of the two stocks.
This table compares W. R. Berkley and BlackRock TCP Capital’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|W. R. Berkley||8.47%||10.21%||2.27%|
|BlackRock TCP Capital||21.88%||11.27%||5.69%|
W. R. Berkley beats BlackRock TCP Capital on 9 of the 17 factors compared between the two stocks.
W. R. Berkley Company Profile
W. R. Berkley Corporation, an insurance holding company, operates as a commercial lines writer in the United States and internationally. It operates through two segments, Insurance and Reinsurance. The Insurance segment underwrites commercial insurance business, including premises operations, commercial automobile, property, products liability, and professional liability lines. It also provides workers' compensation, property casualty, general liability, professional liability, and excess and umbrella coverage insurance products, as well as coverages for technology, ambulatory surgery centers, chiropractors, and concierge physicians; accident and health insurance and reinsurance products; insurance for commercial risks; pollution liability and coverages to contractors, consultants, and owners; and liquor liability and inland marine coverage for small to medium-sized insureds. In addition, this segment offers directors and officers, and surety risk products, as well as products for life sciences and travel industries; coverage for excess liability, construction wrap-ups, and completed operations; cyber risk solutions; casualty, group life, and crime-related insurance products; personal lines insurance solutions, including home, condo/co-op, and collectibles; automobile, law enforcement, public officials and educator's legal, and employment practices liability, as well as incidental medical insurance products; and at-risk and alternative risk insurance program management services. The Reinsurance segment provides other insurance companies and self-insureds with assistance in managing their net risk through reinsurance on a portfolio basis through treaty reinsurance or on an individual basis through facultative reinsurance. W. R. Berkley Corporation was founded in 1967 and is headquartered in Greenwich, Connecticut.
BlackRock TCP Capital Company Profile
BlackRock TCP Capital Corp. is a business development company specializing in direct equity and debt investments in middle-market, senior secured loans, junior loans, originated loans, mezzanine, senior debt instruments, bonds, and secondary-market investments. 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. It prefers to make equity investments in companies for an ownership stake.
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