Contrasting Monroe Capital (NASDAQ:MRCC) & Patria Investments (NYSE:PAX)

Patria Investments (NYSE:PAXGet Free Report) and Monroe Capital (NASDAQ:MRCCGet Free Report) are both small-cap finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, dividends, profitability, valuation and earnings.

Dividends

Patria Investments pays an annual dividend of $1.59 per share and has a dividend yield of 10.9%. Monroe Capital pays an annual dividend of $1.00 per share and has a dividend yield of 13.8%. Patria Investments pays out 196.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Monroe Capital pays out 5,002.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Patria Investments has raised its dividend for 1 consecutive years.

Insider & Institutional Ownership

96.3% of Patria Investments shares are held by institutional investors. 58.1% of Patria Investments shares are held by insiders. Comparatively, 3.6% of Monroe Capital shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Patria Investments and Monroe Capital, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Patria Investments 0 1 0 0 2.00
Monroe Capital 0 1 1 0 2.50

Patria Investments currently has a consensus target price of $17.00, suggesting a potential upside of 16.04%. Monroe Capital has a consensus target price of $8.50, suggesting a potential upside of 16.92%. Given Monroe Capital’s stronger consensus rating and higher probable upside, analysts plainly believe Monroe Capital is more favorable than Patria Investments.

Profitability

This table compares Patria Investments and Monroe Capital’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Patria Investments 36.81% 38.20% 19.57%
Monroe Capital 0.58% 11.24% 4.41%

Risk & Volatility

Patria Investments has a beta of 0.6, suggesting that its stock price is 40% less volatile than the S&P 500. Comparatively, Monroe Capital has a beta of 1.06, suggesting that its stock price is 6% more volatile than the S&P 500.

Earnings and Valuation

This table compares Patria Investments and Monroe Capital’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Patria Investments $307.16 million 2.59 $118.40 million $0.81 18.09
Monroe Capital $64.30 million N/A $370,000.00 $0.02 363.68

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

Summary

Patria Investments beats Monroe Capital on 10 of the 16 factors compared between the two stocks.

About Patria Investments

(Get Free Report)

Patria Investments Limited operates as a private market investment firm focused on investing in Latin America. The company offers asset management services to investors focusing on private equity funds, infrastructure development funds, co-investments funds, constructivist equity funds, and real estate and credit funds. Patria Investments Limited was founded in 1994 and is headquartered in Grand Cayman, the Cayman Islands.

About Monroe Capital

(Get Free Report)

Monroe Capital Corporation is a business development company specializing in customized financing solutions in senior, unitranche and junior secured debt, subordinated debt financing and to a lesser extent, unsecured debt and equity, including equity co-investments in preferred and common stock and warrants. It also provides financing primarily to leveraged buyouts in lower middle-market companies. It focuses to invest in the United States and Canada. The fund prefers to invest in companies with EBITDA between $3 and $35 million. Its makes minority equity investments.

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