Critical Survey: Palmer Square Capital BDC (NYSE:PSBD) versus PRA Group (NASDAQ:PRAA)

PRA Group (NASDAQ:PRAAGet Free Report) and Palmer Square Capital BDC (NYSE:PSBDGet Free Report) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitability, institutional ownership, earnings, valuation and dividends.

Insider and Institutional Ownership

97.2% of PRA Group shares are owned by institutional investors. Comparatively, 6.5% of Palmer Square Capital BDC shares are owned by institutional investors. 2.0% of PRA Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares PRA Group and Palmer Square Capital BDC’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
PRA Group $802.55 million 1.06 -$83.48 million ($0.54) -40.20
Palmer Square Capital BDC $112.22 million 4.82 $107.84 million N/A N/A

Palmer Square Capital BDC has lower revenue, but higher earnings than PRA Group.

Analyst Recommendations

This is a summary of current ratings and recommmendations for PRA Group and Palmer Square Capital BDC, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PRA Group 0 0 1 0 3.00
Palmer Square Capital BDC 0 3 4 0 2.57

PRA Group presently has a consensus target price of $33.00, suggesting a potential upside of 52.00%. Palmer Square Capital BDC has a consensus target price of $16.93, suggesting a potential upside of 1.92%. Given PRA Group’s stronger consensus rating and higher possible upside, equities research analysts clearly believe PRA Group is more favorable than Palmer Square Capital BDC.

Profitability

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

Net Margins Return on Equity Return on Assets
PRA Group -2.37% -1.76% -0.48%
Palmer Square Capital BDC 84.94% 18.90% 7.55%

Summary

Palmer Square Capital BDC beats PRA Group on 6 of the 11 factors compared between the two stocks.

About PRA Group

(Get Free Report)

PRA Group, Inc., a financial and business services company, engages in the purchase, collection, and management of portfolios of nonperforming loans worldwide. It is involved in the purchase of accounts that are primarily the unpaid obligations of individuals owed to credit originators, which include banks and other types of consumer, retail, and auto finance companies. The company also acquires nonperforming loans, including Visa and MasterCard credit card accounts, private label and other credit card accounts, personal loans, automobile loans, and small business loans from banks, credit unions, consumer finance companies, retailers, utilities, automobile finance companies, and other credit originators. In addition, it provides fee-based services on class action claims recoveries. The company was formerly known as Portfolio Recovery Associates, Inc. and changed its name to PRA Group, Inc. in October 2014. PRA Group, Inc. was founded in 1996 and is headquartered in Norfolk, Virginia.

About Palmer Square Capital BDC

(Get Free Report)

Palmer Square Capital BDC Inc. is an externally managed, non-diversified closed-end management investment company which primarily lends to and invests in corporate debt securities, including small to large private U.S. companies and has elected to be regulated as a business development company. Palmer Square Capital BDC Inc. is based in MISSION WOODS, Kan.

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