Financial Survey: Fidus Investment (NASDAQ:FDUS) & Oxford Square Capital (NASDAQ:OXSQ)

Oxford Square Capital (NASDAQ:OXSQ) and Fidus Investment (NASDAQ:FDUS) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, analyst recommendations, valuation, profitability, institutional ownership, risk and earnings.

Valuation and Earnings

This table compares Oxford Square Capital and Fidus Investment”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Oxford Square Capital	$40.34 million	3.45	-$18.73 million	($0.43)	-3.47
Fidus Investment	$98.45 million	7.79	$82.40 million	$2.28	8.86

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

Profitability

This table compares Oxford Square Capital and Fidus Investment’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Oxford Square Capital	-92.37%	14.11%	7.02%
Fidus Investment	49.51%	11.19%	5.97%

Dividends

Oxford Square Capital pays an annual dividend of $0.42 per share and has a dividend yield of 28.2%. Fidus Investment pays an annual dividend of $1.72 per share and has a dividend yield of 8.5%. Oxford Square Capital pays out -97.7% of its earnings in the form of a dividend. Fidus Investment pays out 75.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Oxford Square Capital is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a breakdown of current ratings for Oxford Square Capital and Fidus Investment, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Oxford Square Capital	1	0	0	0	1.00
Fidus Investment	0	2	1	1	2.75

Fidus Investment has a consensus target price of $21.00, indicating a potential upside of 3.91%. Given Fidus Investment’s stronger consensus rating and higher probable upside, analysts clearly believe Fidus Investment is more favorable than Oxford Square Capital.

Insider and Institutional Ownership

6.4% of Oxford Square Capital shares are owned by institutional investors. Comparatively, 28.1% of Fidus Investment shares are owned by institutional investors. 8.6% of Oxford Square Capital shares are owned by company insiders. Comparatively, 0.9% of Fidus Investment shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility & Risk

Oxford Square Capital has a beta of 0.38, suggesting that its share price is 62% less volatile than the S&P 500. Comparatively, Fidus Investment has a beta of 0.67, suggesting that its share price is 33% less volatile than the S&P 500.

Summary

Fidus Investment beats Oxford Square Capital on 12 of the 17 factors compared between the two stocks.

About Oxford Square Capital

Oxford Square Capital Corp. is a business development company, operates as a closed-end, non-diversified management investment company. It is a private equity and mezzanine firm. The firm invests in both public and private companies. It invests in secured and unsecured senior debt, subordinated debt, junior subordinated debt, preferred stock, common stock and syndicated bank loans. The firm primarily invests in debt and/or equity securities of technology-related companies that operate in the computer software, Internet, information technology infrastructure and services, media, telecommunications and telecommunications equipment, semiconductors, hardware, technology-enabled services, semiconductor capital equipment, medical device technology, diversified technology, and networking systems sectors. It concentrates its investments in companies having annual revenues of less than $200 million and a market capitalization or enterprise value of less than $300 million. The firm invests between $5 million and $30 million per transaction. It seeks to exit its investments within 7 years. It serves as the investment adviser to TICC. Oxford Square Capital Corp., formerly known as TICC Capital Corp., was founded in 2003 and is headquartered in Greenwich, Connecticut.

About Fidus Investment

Fidus Investment Corporation is a business development company. It specializing in leveraged buyouts, refinancings, change of ownership transactions, recapitalizations, strategic acquisitions, mezzanine, growth capital, business expansion, lower middle market investments, debt investments, subordinated and second lien loans, senior secured and unitranche debt, preferred equity, warrants, subordinated debt, senior subordinated notes, junior secured loans, and unitranche loans. It does not invest in turnarounds or distressed situations. The fund prefers to invest in aerospace and defense, business services, consumer products and services including retail, food, and beverage, healthcare products and services, industrial products and services, information technology services, niche manufacturing, transportation and logistics, and value-added distribution sectors. It seeks to invest in companies based in United States. The fund typically invests between $5 million and $15 million per transaction in companies with annual revenues between $10 million and $150 million and an annual EBITDA between $3 million and $20 million, but it can occasionally invest in larger or smaller companies. It seeks to acquire minority equity stakes and board observation rights in conjunction with its investments.