Fairfax Financial (OTCMKTS:FFXDF) and Stellus Capital Investment (NYSE:SCM) are both small-cap finance companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, institutional ownership, earnings, risk, analyst recommendations, dividends and valuation.
This table compares Fairfax Financial and Stellus Capital Investment’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Stellus Capital Investment||-45.82%||9.38%||3.95%|
Risk & Volatility
Fairfax Financial has a beta of 1.28, indicating that its stock price is 28% more volatile than the S&P 500. Comparatively, Stellus Capital Investment has a beta of 1.14, indicating that its stock price is 14% more volatile than the S&P 500.
Institutional & Insider Ownership
0.2% of Fairfax Financial shares are held by institutional investors. Comparatively, 14.3% of Stellus Capital Investment shares are held by institutional investors. 5.4% of Stellus Capital Investment shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Valuation & Earnings
This table compares Fairfax Financial and Stellus Capital Investment’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Fairfax Financial||$712.69 million||1.75||$516.34 million||N/A||N/A|
|Stellus Capital Investment||$58.91 million||2.65||$26.44 million||$1.23||6.51|
Fairfax Financial has higher revenue and earnings than Stellus Capital Investment.
This is a breakdown of recent ratings and target prices for Fairfax Financial and Stellus Capital Investment, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Stellus Capital Investment||0||4||0||0||2.00|
Stellus Capital Investment has a consensus price target of $8.00, suggesting a potential downside of 0.12%. Given Stellus Capital Investment’s higher possible upside, analysts clearly believe Stellus Capital Investment is more favorable than Fairfax Financial.
Fairfax Financial beats Stellus Capital Investment on 7 of the 13 factors compared between the two stocks.
Fairfax Financial Company Profile
Fairfax India Holdings Corporation, an investment holding company, engages in the investment activities in India. It invests in public and private equity securities and debt instruments in India and Indian businesses, or other businesses with customers, suppliers, or business primarily conducted in, or dependent on, India. The company was founded in 2014 and is headquartered in Toronto, Canada. Fairfax India Holdings Corporation is a subsidiary of Fairfax Financial Holdings Limited.
Stellus Capital Investment Company Profile
Stellus Capital Investment Corporation is a business development company specializing in investments in private middle-market companies. It invests through first lien, second lien, unitranche, and mezzanine debt financing, often with a corresponding equity investment. The fund seeks to invest in companies with an EBITDA between $5 million and $50 million.
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