Analyzing Palmer Square Capital BDC (NYSE:PSBD) and Blackstone (NYSE:BX)

Palmer Square Capital BDC (NYSE:PSBD) and Blackstone (NYSE:BX) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, valuation, profitability, risk and dividends.

Dividends

Palmer Square Capital BDC pays an annual dividend of $1.44 per share and has a dividend yield of 14.5%. Blackstone pays an annual dividend of $4.48 per share and has a dividend yield of 3.7%. Palmer Square Capital BDC pays out -228.6% of its earnings in the form of a dividend. Blackstone pays out 99.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Palmer Square Capital BDC is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation & Earnings

This table compares Palmer Square Capital BDC and Blackstone”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Palmer Square Capital BDC	-$15.81 million	-18.94	-$3.17 million	($0.63)	-15.77
Blackstone	$13.78 billion	6.67	$3.02 billion	$4.50	27.24

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

Analyst Recommendations

This is a breakdown of recent recommendations for Palmer Square Capital BDC and Blackstone, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Palmer Square Capital BDC	0	5	0	0	2.00
Blackstone	0	12	13	0	2.52

Palmer Square Capital BDC currently has a consensus target price of $10.50, suggesting a potential upside of 5.69%. Blackstone has a consensus target price of $144.57, suggesting a potential upside of 17.94%. Given Blackstone’s stronger consensus rating and higher possible upside, analysts clearly believe Blackstone is more favorable than Palmer Square Capital BDC.

Insider and Institutional Ownership

6.5% of Palmer Square Capital BDC shares are owned by institutional investors. Comparatively, 70.0% of Blackstone shares are owned by institutional investors. 1.1% of Palmer Square Capital BDC shares are owned by insiders. Comparatively, 1.0% of Blackstone shares are owned 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.

Profitability

This table compares Palmer Square Capital BDC and Blackstone’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Palmer Square Capital BDC	-18.27%	11.33%	4.13%
Blackstone	22.11%	23.16%	9.61%

Risk & Volatility

Palmer Square Capital BDC has a beta of 0.85, meaning that its stock price is 15% less volatile than the S&P 500. Comparatively, Blackstone has a beta of 1.52, meaning that its stock price is 52% more volatile than the S&P 500.

Summary

Blackstone beats Palmer Square Capital BDC on 13 of the 16 factors compared between the two stocks.

About Palmer Square Capital BDC

Palmer Square Capital BDC, Inc. is an externally managed business development company that seeks to provide financing to private middle-market companies. The company focuses primarily on privately originated and negotiated investments in senior secured loans and other debt instruments, with the goal of supporting businesses while generating current income for shareholders. Palmer Square Capital BDC may invest across a range of industries and capital structures, including first-lien and unitranche loans, second-lien and subordinated debt, and select equity investments.

About Blackstone

Blackstone Inc. is a global alternative asset manager that invests on behalf of institutional and individual investors. Its businesses span private equity, real estate, credit and insurance, infrastructure, and multi-asset investing, with strategies that include private funds and investment products for a range of clients. Founded in 1985 by Stephen A. Schwarzman and Peter G. Peterson, the firm initially focused on mergers and acquisitions advisory work before expanding into investment management.