Analyzing Nuveen Churchill Direct Lending (NYSE:NCDL) and Ocwen Financial (NYSE:OCN)

Nuveen Churchill Direct Lending (NYSE:NCDL) and Ocwen Financial (NYSE:OCN) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, earnings, risk, dividends, valuation, analyst recommendations and profitability.

Analyst Ratings

This is a breakdown of recent recommendations for Nuveen Churchill Direct Lending and Ocwen Financial, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nuveen Churchill Direct Lending	0	3	3	0	2.50
Ocwen Financial	0	1	1	0	2.50

Nuveen Churchill Direct Lending currently has a consensus price target of $18.50, suggesting a potential upside of 6.69%. Ocwen Financial has a consensus price target of $39.00, suggesting a potential upside of 59.44%. Given Ocwen Financial’s higher possible upside, analysts clearly believe Ocwen Financial is more favorable than Nuveen Churchill Direct Lending.

Institutional & Insider Ownership

70.2% of Ocwen Financial shares are owned by institutional investors. 5.8% of Ocwen Financial shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Nuveen Churchill Direct Lending and Ocwen Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nuveen Churchill Direct Lending	46.95%	11.91%	4.89%
Ocwen Financial	-5.97%	10.21%	0.34%

Valuation & Earnings

This table compares Nuveen Churchill Direct Lending and Ocwen Financial’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	$161.76 million	5.88	$75.94 million	N/A	N/A
Ocwen Financial	$1.14 billion	0.17	-$63.70 million	($8.55)	-2.86

Nuveen Churchill Direct Lending has higher earnings, but lower revenue than Ocwen Financial.

Summary

Nuveen Churchill Direct Lending beats Ocwen Financial on 6 of the 10 factors compared between 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 Ocwen Financial

Ocwen Financial Corporation, a financial services company, originates and services mortgage loans in the United States, the United States Virgin Islands, India, and the Philippines. It operates through, Servicing and Originations segments. The company provides commercial forward mortgage loan servicing, reverse mortgage servicing, special servicing, and asset management services for to owners of mortgage loans and foreclosed real estate, as well as residential mortgage loan servicing, such as forward and reverse conventional, government-insured, and non-agency loans, including the reverse mortgage loans classified as loans. It also originates and purchases conventional and government-insured residential forward and reverse mortgage loans through its correspondent lending arrangements, broker relationships, and retail channels. It serves primarily under the PHH Mortgage and Liberty Reverse Mortgage brands. Ocwen Financial Corporation was founded in 1988 and is headquartered in West Palm Beach, Florida.