BlackRock TCP Capital (NASDAQ:TCPC – Get Free Report) and Lemonade (NYSE:LMND – Get Free Report) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, risk, dividends, analyst recommendations, institutional ownership and earnings.
Analyst Recommendations
This is a breakdown of current ratings and target prices for BlackRock TCP Capital and Lemonade, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| BlackRock TCP Capital | 1 | 5 | 0 | 0 | 1.83 |
| Lemonade | 3 | 2 | 1 | 0 | 1.67 |
BlackRock TCP Capital presently has a consensus target price of $9.00, suggesting a potential downside of 4.66%. Lemonade has a consensus target price of $32.67, suggesting a potential downside of 7.81%. Given BlackRock TCP Capital’s stronger consensus rating and higher probable upside, equities research analysts plainly believe BlackRock TCP Capital is more favorable than Lemonade.
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| BlackRock TCP Capital | $209.33 million | 3.86 | $38.47 million | ($0.50) | -18.88 |
| Lemonade | $493.20 million | 5.13 | -$236.90 million | ($3.04) | -11.66 |
BlackRock TCP Capital has higher earnings, but lower revenue than Lemonade. BlackRock TCP Capital is trading at a lower price-to-earnings ratio than Lemonade, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares BlackRock TCP Capital and Lemonade’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| BlackRock TCP Capital | -15.22% | 14.16% | 5.80% |
| Lemonade | -43.51% | -32.85% | -12.59% |
Volatility and Risk
BlackRock TCP Capital has a beta of 1.5, suggesting that its stock price is 50% more volatile than the S&P 500. Comparatively, Lemonade has a beta of 2.15, suggesting that its stock price is 115% more volatile than the S&P 500.
Insider & Institutional Ownership
80.3% of Lemonade shares are held by institutional investors. 0.2% of BlackRock TCP Capital shares are held by insiders. Comparatively, 12.5% of Lemonade 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.
Summary
BlackRock TCP Capital beats Lemonade on 7 of the 13 factors compared between the two stocks.
About BlackRock TCP Capital
BlackRock TCP Capital Corp. is a business development company specializing in direct equity and debt investments in middle-market, small businesses, debt securities, senior secured loans, junior loans, originated loans, mezzanine, senior debt instruments, bonds, and secondary-market investments. It typically invests in communication services, public relations services, television, wireless telecommunication services, apparel, textile mills, restaurants, retailing, energy, oil and gas extraction, Patent owners and Lessors, Federal and Federally- Sponsored Credit agencies, insurance, hospital and healthcare centers, Biotechnology, engineering services, heavy electrical equipment, tax accounting, scientific and related consulting services, charter freight air transportation, Information technology consulting, application hosting services, software diagram and design, computer aided design, communication equipment, electronics manufacturing equipment, computer components, chemicals. 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 including complex situations. It prefers to make equity investments in companies for an ownership stake.
About Lemonade
Lemonade, Inc. provides various insurance products through various channels in the United States, Europe, and the United Kingdom. Its insurance products include stolen or damaged property, and personal liability that protects its customers if they are responsible for an accident or damage to another person or their property. The company also offers renters, homeowners, car, pet, and life insurance products, as well as landlord insurance policies. In addition, it operates as an agent for other insurance companies. The company was formerly known as Lemonade Group, Inc. and changed its name to Lemonade, Inc. Lemonade, Inc. was incorporated in 2015 and is headquartered in New York, New York.
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