Contrasting Crescent Capital BDC (NASDAQ:CCAP) & Burford Capital (NYSE:BUR)

Burford Capital (NYSE:BUR) and Crescent Capital BDC (NASDAQ:CCAP) are both finance companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, analyst recommendations, earnings, profitability, valuation, risk and institutional ownership.

Analyst Ratings

This is a breakdown of current ratings and target prices for Burford Capital and Crescent Capital BDC, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Burford Capital	0	0	3	0	3.00
Crescent Capital BDC	0	2	3	0	2.60

Burford Capital presently has a consensus price target of $19.50, suggesting a potential upside of 43.17%. Crescent Capital BDC has a consensus price target of $17.60, suggesting a potential upside of 12.75%. Given Burford Capital’s stronger consensus rating and higher possible upside, equities analysts plainly believe Burford Capital is more favorable than Crescent Capital BDC.

Volatility & Risk

Burford Capital has a beta of 0.7, indicating that its share price is 30% less volatile than the S&P 500. Comparatively, Crescent Capital BDC has a beta of 0.63, indicating that its share price is 37% less volatile than the S&P 500.

Dividends

Burford Capital pays an annual dividend of $0.12 per share and has a dividend yield of 0.9%. Crescent Capital BDC pays an annual dividend of $1.68 per share and has a dividend yield of 10.8%. Burford Capital pays out 12.9% of its earnings in the form of a dividend. Crescent Capital BDC pays out 125.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Crescent Capital BDC has increased its dividend for 1 consecutive years. Crescent Capital BDC is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

49.5% of Crescent Capital BDC shares are owned by institutional investors. 8.9% of Burford Capital shares are owned by insiders. Comparatively, 1.1% of Crescent Capital BDC shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Burford Capital and Crescent Capital BDC”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Burford Capital	$410.92 million	7.25	$610.52 million	$0.93	14.65
Crescent Capital BDC	$83.50 million	6.93	$83.84 million	$1.34	11.65

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

Profitability

This table compares Burford Capital and Crescent Capital BDC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Burford Capital	34.81%	8.07%	4.28%
Crescent Capital BDC	37.32%	11.90%	5.40%

Summary

Burford Capital beats Crescent Capital BDC on 9 of the 16 factors compared between the two stocks.

About Burford Capital

Burford Capital Limited provides legal finance products and services worldwide. The company operates through two segments, Capital Provision, and Asset Management and Other Provision. The Capital Provision segment provides capital to the legal industry or in connection with legal matters directly and through investment in private funds; legal risk management services; lower risk legal finance business focusing on pre-settlement litigation matters with lower risk and lower expected returns; post-settlement finance; and complex strategies in which it acts as a principal and acquires assets that are mispriced. The Asset Management and Other Services segment provides services to the legal industry, including litigation insurance. Burford Capital Limited was incorporated in 2009 and is based in Saint Peter Port, Guernsey.

About Crescent Capital BDC

Crescent Capital BDC, Inc. is as a business development company private equity / buyouts and loan fund. It specializes in directly investing. It specializes in middle market. The fund seeks to invest in United States.