Head to Head Analysis: Barings Corporate Investors (NYSE:MCI) and Great Elm Capital Group (NASDAQ:GECC)

Great Elm Capital Group (NASDAQ:GECC) and Barings Corporate Investors (NYSE:MCI) are both small-cap finance companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, risk, earnings, dividends and institutional ownership.

Analyst Ratings

This is a breakdown of current recommendations for Great Elm Capital Group and Barings Corporate Investors, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Great Elm Capital Group	1	2	0	0	1.67
Barings Corporate Investors	0	0	0	0	0.00

Great Elm Capital Group presently has a consensus price target of $10.50, indicating a potential upside of 48.94%. Given Great Elm Capital Group’s stronger consensus rating and higher probable upside, research analysts clearly believe Great Elm Capital Group is more favorable than Barings Corporate Investors.

Profitability

This table compares Great Elm Capital Group and Barings Corporate Investors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Great Elm Capital Group	-17.08%	10.97%	3.95%
Barings Corporate Investors	N/A	N/A	N/A

Insider and Institutional Ownership

38.8% of Great Elm Capital Group shares are held by institutional investors. 8.7% of Great Elm Capital Group shares are held by insiders. Comparatively, 1.1% of Barings Corporate Investors shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Great Elm Capital Group and Barings Corporate Investors”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Great Elm Capital Group	$39.32 million	2.51	$3.55 million	($0.56)	-12.59
Barings Corporate Investors	N/A	N/A	N/A	N/A	N/A

Great Elm Capital Group has higher revenue and earnings than Barings Corporate Investors.

Risk and Volatility

Great Elm Capital Group has a beta of 0.64, suggesting that its share price is 36% less volatile than the S&P 500. Comparatively, Barings Corporate Investors has a beta of 0.28, suggesting that its share price is 72% less volatile than the S&P 500.

Dividends

Great Elm Capital Group pays an annual dividend of $1.48 per share and has a dividend yield of 21.0%. Barings Corporate Investors pays an annual dividend of $1.60 per share and has a dividend yield of 8.3%. Great Elm Capital Group pays out -264.3% of its earnings in the form of a dividend. Great Elm Capital Group has increased its dividend for 2 consecutive years. Great Elm Capital Group is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Great Elm Capital Group beats Barings Corporate Investors on 11 of the 12 factors compared between the two stocks.

About Great Elm Capital Group

Great Elm Capital Corp. is a business development company which specializes in loan and mezzanine, middle market investments. It invests in the debt instruments of middle market companies. The fund prefers to invest in media, commercial services and supplies, healthcare, telecommunication services, communications equipment. It typically makes equity investments between $3 million and $10 million in companies with revenues between $3 million and $75 million.

About Barings Corporate Investors

Babson Capital Corporate Investors trust is a closed ended fixed income mutual fund launched and managed by Barings LLC. It invests in fixed income markets of the United States. The fund seeks to invest in securities of companies operating across diversified sectors. It primarily invests in a portfolio of privately placed, below-investment grade, long term corporate debt obligations. The fund also invests in marketable investment grade debt securities, other marketable debt securities, and marketable common stocks. It was formerly known as Babson Capital Corporate Investors. Babson Capital Corporate Investors trust was formed in 1971 and is domiciled in the United States.