Kayne Anderson Energy Development (KED) & Harvest Capital Credit (HCAP) Head-To-Head Contrast

Kayne Anderson Energy Development (NYSE: KED) and Harvest Capital Credit (NASDAQ:HCAP) are both small-cap financials companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, profitability, institutional ownership, earnings, risk and analyst recommendations.

Dividends

Kayne Anderson Energy Development pays an annual dividend of $1.60 per share and has a dividend yield of 10.3%. Harvest Capital Credit pays an annual dividend of $1.35 per share and has a dividend yield of 12.2%. Kayne Anderson Energy Development pays out -2,285.7% of its earnings in the form of a dividend. Harvest Capital Credit pays out 287.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Institutional and Insider Ownership

5.7% of Harvest Capital Credit shares are owned by institutional investors. 9.5% of Harvest Capital Credit shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations and price targets for Kayne Anderson Energy Development and Harvest Capital Credit, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kayne Anderson Energy Development 0 0 1 0 3.00
Harvest Capital Credit 0 1 0 0 2.00

Kayne Anderson Energy Development currently has a consensus target price of $20.00, suggesting a potential upside of 28.62%. Harvest Capital Credit has a consensus target price of $13.50, suggesting a potential upside of 21.51%. Given Kayne Anderson Energy Development’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Kayne Anderson Energy Development is more favorable than Harvest Capital Credit.

Profitability

This table compares Kayne Anderson Energy Development and Harvest Capital Credit’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kayne Anderson Energy Development -2,475.00% -13.79% -8.15%
Harvest Capital Credit 14.76% 11.04% 6.80%

Valuation & Earnings

This table compares Kayne Anderson Energy Development and Harvest Capital Credit’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Kayne Anderson Energy Development N/A N/A N/A ($0.07) -222.14
Harvest Capital Credit $20.89 million 3.45 $6.00 million $0.47 23.64

Harvest Capital Credit has higher revenue and earnings than Kayne Anderson Energy Development. Kayne Anderson Energy Development is trading at a lower price-to-earnings ratio than Harvest Capital Credit, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Kayne Anderson Energy Development has a beta of 1.28, suggesting that its stock price is 28% more volatile than the S&P 500. Comparatively, Harvest Capital Credit has a beta of 0.67, suggesting that its stock price is 33% less volatile than the S&P 500.

Summary

Harvest Capital Credit beats Kayne Anderson Energy Development on 8 of the 13 factors compared between the two stocks.

Kayne Anderson Energy Development Company Profile

Kayne Anderson Energy Development Company is a non-diversified, closed-end fund. The Fund’s investment objective is to generate both current income and capital appreciation, through equity and debt investments. It seeks to achieve this objective by investing approximately 80% of its total assets in securities of companies that derive their revenue from activities in the energy industry, including midstream energy companies, which operates assets used to gather, transport, process, treat, terminal and store natural gas, natural gas liquids, crude oil or refined petroleum products; upstream energy companies, which are engaged in the exploration, extraction and production of natural resources, including natural gas, natural gas liquids and crude oil, from onshore and offshore geological reservoirs, and other energy companies, which are engaged in owning, leasing, managing, producing, processing and selling of coal and coal reserves. KA Fund Advisors, LLC is the advisor of the Fund.

Harvest Capital Credit Company Profile

Harvest Capital Credit Corporation is an externally managed, closed-end, non-diversified management investment company. The Company operates as a business development company and provides customized financing solutions for small to mid-sized companies. Its investment objective is to generate both current income and capital appreciation by making direct investments in the form of subordinated debt, senior debt, and to a lesser extent, minority equity investments in privately-held the United States small to mid-sized companies. Its investment portfolio includes over 56.8% of senior secured term loans, 40.8% of junior secured term loans, 1.3% of equity investments and 1.1% of collateralized loan obligation (CLO) equity at fair value. It may also invest in other investments, such as loans to larger, publicly-traded companies, high-yield bonds and distressed debt securities. It may also invest in debt and equity securities issued by CLO funds. HCAP Advisors LLC is its investment adviser.

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