Comparing Nuveen Churchill Direct Lending (NYSE:NCDL) and TriplePoint Venture Growth BDC (NYSE:TPVG)

Nuveen Churchill Direct Lending (NYSE:NCDL) and TriplePoint Venture Growth BDC (NYSE:TPVG) are both small-cap finance companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, institutional ownership, dividends, valuation, analyst recommendations, profitability and risk.

Dividends

Nuveen Churchill Direct Lending pays an annual dividend of $1.80 per share and has a dividend yield of 12.8%. TriplePoint Venture Growth BDC pays an annual dividend of $0.92 per share and has a dividend yield of 16.2%. Nuveen Churchill Direct Lending pays out 117.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TriplePoint Venture Growth BDC pays out 108.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TriplePoint Venture Growth BDC is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider and Institutional Ownership

12.8% of TriplePoint Venture Growth BDC shares are held by institutional investors. 0.6% of Nuveen Churchill Direct Lending shares are held by insiders. Comparatively, 1.5% of TriplePoint Venture Growth BDC shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Nuveen Churchill Direct Lending and TriplePoint Venture Growth BDC, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nuveen Churchill Direct Lending	0	4	1	0	2.20
TriplePoint Venture Growth BDC	1	6	0	0	1.86

Nuveen Churchill Direct Lending presently has a consensus target price of $15.75, suggesting a potential upside of 12.30%. TriplePoint Venture Growth BDC has a consensus target price of $6.25, suggesting a potential upside of 10.15%. Given Nuveen Churchill Direct Lending’s stronger consensus rating and higher possible upside, equities analysts clearly believe Nuveen Churchill Direct Lending is more favorable than TriplePoint Venture Growth BDC.

Volatility and Risk

Nuveen Churchill Direct Lending has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500. Comparatively, TriplePoint Venture Growth BDC has a beta of 1.36, indicating that its share price is 36% more volatile than the S&P 500.

Profitability

This table compares Nuveen Churchill Direct Lending and TriplePoint Venture Growth BDC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nuveen Churchill Direct Lending	36.83%	11.13%	4.83%
TriplePoint Venture Growth BDC	36.02%	12.88%	5.76%

Valuation & Earnings

This table compares Nuveen Churchill Direct Lending and TriplePoint Venture Growth BDC”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nuveen Churchill Direct Lending	$224.04 million	3.09	$116.32 million	$1.53	9.17
TriplePoint Venture Growth BDC	$44.08 million	5.20	$32.05 million	$0.85	6.68

Nuveen Churchill Direct Lending has higher revenue and earnings than TriplePoint Venture Growth BDC. TriplePoint Venture Growth BDC is trading at a lower price-to-earnings ratio than Nuveen Churchill Direct Lending, indicating that it is currently the more affordable of the two stocks.

About Nuveen Churchill Direct Lending

Nuveen Churchill Direct Lending Corp. is a specialty finance company focused primarily on investing in senior secured loans to private equity-owned U.S. middle market companies. It has elected to be regulated as a business development company. Nuveen Churchill Direct Lending Corp. is based in NEW YORK.

About TriplePoint Venture Growth BDC

TriplePoint Venture Growth BDC Corp. is a business development company specializing investments in venture capital-backed companies at the growth stage investments. It also provides debt financing to venture growth space companies which includes growth capital loans, secured and customized loans, equipment financings, revolving loans and direct equity investments. The fund seeks to invest in e-commerce, entertainment, technology and life sciences sector. Within technology the areas of focus include: Security, wireless communication equipments, network system and software, business applications software, conferencing equipments/services .big data, cloud computing, data storage, electronics, energy efficiency, hardware, information services, internet and media, networking, semiconductors, software, software as a service, and other technology related subsectors and within life sciences the areas of focus include: biotechnology, bio fuels/bio mass, diagnostic testing and bioinformatics, drug delivery, drug discovery, healthcare information systems, healthcare services, medical, surgical and therapeutic devices, pharmaceuticals and other life science related subsectors. Within growth capital loans it invests between $5 million and $50 million, for equipment financings it invests between $5 million and $25 million, for revolving loans it invests between $1 million and $25 million, and for direct equity investments it may invest between $0.1 million and $5 million (generally not exceeding 5% of the company’s total equity). The debt financing products are typically structured as lines of credit and it invests through warrants and secured loans. It targeted returns between 10% and 18%. It does not take board seat in the company.