Reviewing Portman Ridge Finance (NASDAQ:PTMN) and Arlington Asset Investment (NASDAQ:AI)
Portman Ridge Finance (NASDAQ:PTMN) and Arlington Asset Investment (NYSE:AI) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their profitability, earnings, valuation, institutional ownership, dividends, analyst recommendations and risk.
This is a breakdown of current ratings and target prices for Portman Ridge Finance and Arlington Asset Investment, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Portman Ridge Finance||0||0||1||0||3.00|
|Arlington Asset Investment||0||1||1||0||2.50|
This table compares Portman Ridge Finance and Arlington Asset Investment’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Portman Ridge Finance||-108.42%||2.08%||1.01%|
|Arlington Asset Investment||-30.19%||14.08%||0.95%|
Valuation and Earnings
This table compares Portman Ridge Finance and Arlington Asset Investment’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Portman Ridge Finance||$27.09 million||3.26||-$9.57 million||$0.27||8.74|
|Arlington Asset Investment||$130.95 million||1.61||-$91.79 million||$2.06||2.78|
Portman Ridge Finance has higher earnings, but lower revenue than Arlington Asset Investment. Arlington Asset Investment is trading at a lower price-to-earnings ratio than Portman Ridge Finance, indicating that it is currently the more affordable of the two stocks.
Portman Ridge Finance pays an annual dividend of $0.24 per share and has a dividend yield of 10.2%. Arlington Asset Investment pays an annual dividend of $0.90 per share and has a dividend yield of 15.7%. Portman Ridge Finance pays out 88.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Arlington Asset Investment pays out 43.7% of its earnings in the form of a dividend. Arlington Asset Investment is clearly the better dividend stock, given its higher yield and lower payout ratio.
Risk & Volatility
Portman Ridge Finance has a beta of 0.67, indicating that its stock price is 33% less volatile than the S&P 500. Comparatively, Arlington Asset Investment has a beta of 1.02, indicating that its stock price is 2% more volatile than the S&P 500.
Insider and Institutional Ownership
28.6% of Portman Ridge Finance shares are owned by institutional investors. Comparatively, 51.4% of Arlington Asset Investment shares are owned by institutional investors. 6.3% of Portman Ridge Finance shares are owned by company insiders. Comparatively, 2.2% of Arlington Asset Investment shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Arlington Asset Investment beats Portman Ridge Finance on 9 of the 15 factors compared between the two stocks.
Portman Ridge Finance Company Profile
Portman Ridge Finance Corp. is a private equity fund and non-diversified closed-end investment company that invests in middle market companies generating consistent cash flows located in North America. It targets companies operating across a broad range of sectors such as aerospace and defense, automotive, beverage, food and tobacco, broadcasting and entertainment, buildings and real estate, personal and cargo transport, chemicals, plastics and rubber, containers, packaging and glass, diversified or conglomerate service, ecological, electronics, finance, and healthcare. The company was founded on August 8, 2006 and is headquartered in New York, NY.
Arlington Asset Investment Company Profile
Arlington Asset Investment Corp. (NYSE: AI) is a principal investment firm that currently invests primarily in mortgage-related and other assets. The Company is headquartered in the Washington, D.C. metropolitan area. For more information, please visit www.arlingtonasset.com.
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