Bain Capital Specialty Finance (BCSF) vs. Its Peers Critical Survey

Bain Capital Specialty Finance (NYSE:BCSF) is one of 1,746 public companies in the “Capital Markets” industry, but how does it contrast to its peers? We will compare Bain Capital Specialty Finance to related companies based on the strength of its valuation, profitability, earnings, institutional ownership, risk, analyst recommendations and dividends.

Earnings and Valuation

This table compares Bain Capital Specialty Finance and its peers top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Bain Capital Specialty Finance	$273.24 million	$98.76 million	11.56
Bain Capital Specialty Finance Competitors	$2.39 billion	$398.05 million	14.96

Bain Capital Specialty Finance’s peers have higher revenue and earnings than Bain Capital Specialty Finance. Bain Capital Specialty Finance is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Volatility & Risk

Bain Capital Specialty Finance has a beta of 0.59, suggesting that its share price is 41% less volatile than the S&P 500. Comparatively, Bain Capital Specialty Finance’s peers have a beta of 0.79, suggesting that their average share price is 21% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Bain Capital Specialty Finance and its peers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bain Capital Specialty Finance	0	4	0	0	2.00
Bain Capital Specialty Finance Competitors	5615	20215	22568	650	2.37

Bain Capital Specialty Finance currently has a consensus price target of $12.30, suggesting a potential upside of 10.86%. As a group, “Capital Markets” companies have a potential upside of 23.41%. Given Bain Capital Specialty Finance’s peers stronger consensus rating and higher possible upside, analysts plainly believe Bain Capital Specialty Finance has less favorable growth aspects than its peers.

Institutional & Insider Ownership

30.6% of shares of all “Capital Markets” companies are held by institutional investors. 0.6% of Bain Capital Specialty Finance shares are held by company insiders. Comparatively, 13.1% of shares of all “Capital Markets” companies are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Bain Capital Specialty Finance and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bain Capital Specialty Finance	24.14%	10.40%	4.40%
Bain Capital Specialty Finance Competitors	314.66%	9.82%	3.42%

Dividends

Bain Capital Specialty Finance pays an annual dividend of $1.68 per share and has a dividend yield of 15.1%. Bain Capital Specialty Finance pays out 175.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Capital Markets” companies pay a dividend yield of 3.2% and pay out 29.2% of their earnings in the form of a dividend. Bain Capital Specialty Finance has raised its dividend for 4 consecutive years.

Summary

Bain Capital Specialty Finance peers beat Bain Capital Specialty Finance on 12 of the 15 factors compared.

About Bain Capital Specialty Finance

Bain Capital Specialty Finance, Inc. is a business development company that provides financing to middle-market businesses. Its investment portfolio focuses primarily on debt, including first-lien senior secured and unitranche loans, and may also include other debt securities and equity investments. The company works with businesses across a range of industries, primarily in the United States, and may invest in companies in other countries. Bain Capital Specialty Finance is externally managed by Bain Capital Credit, an investment manager affiliated with Bain Capital.