Northern Trust (NASDAQ:NTRS) vs. Oaktree Specialty Lending (NASDAQ:OCSL) Financial Comparison

Northern Trust (NASDAQ:NTRS) and Oaktree Specialty Lending (NASDAQ:OCSL) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their risk, institutional ownership, earnings, profitability, dividends, valuation and analyst recommendations.

Volatility and Risk

Northern Trust has a beta of 1.24, meaning that its stock price is 24% more volatile than the S&P 500. Comparatively, Oaktree Specialty Lending has a beta of 0.51, meaning that its stock price is 49% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Northern Trust and Oaktree Specialty Lending, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northern Trust	2	10	3	0	2.07
Oaktree Specialty Lending	1	5	0	0	1.83

Northern Trust presently has a consensus target price of $183.47, suggesting a potential upside of 9.26%. Oaktree Specialty Lending has a consensus target price of $11.83, suggesting a potential upside of 3.44%. Given Northern Trust’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Northern Trust is more favorable than Oaktree Specialty Lending.

Profitability

This table compares Northern Trust and Oaktree Specialty Lending’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northern Trust	15.86%	17.97%	1.27%
Oaktree Specialty Lending	14.45%	9.70%	4.64%

Dividends

Northern Trust pays an annual dividend of $3.52 per share and has a dividend yield of 2.1%. Oaktree Specialty Lending pays an annual dividend of $1.20 per share and has a dividend yield of 10.5%. Northern Trust pays out 27.6% of its earnings in the form of a dividend. Oaktree Specialty Lending pays out 250.0% 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 & Insider Ownership

83.2% of Northern Trust shares are owned by institutional investors. Comparatively, 36.8% of Oaktree Specialty Lending shares are owned by institutional investors. 0.7% of Northern Trust shares are owned by company insiders. Comparatively, 0.3% of Oaktree Specialty Lending shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Northern Trust and Oaktree Specialty Lending”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Northern Trust	$14.30 billion	2.15	$1.74 billion	$12.76	13.16
Oaktree Specialty Lending	$316.80 million	3.18	$33.92 million	$0.48	23.83

Northern Trust has higher revenue and earnings than Oaktree Specialty Lending. Northern Trust is trading at a lower price-to-earnings ratio than Oaktree Specialty Lending, indicating that it is currently the more affordable of the two stocks.

Summary

Northern Trust beats Oaktree Specialty Lending on 12 of the 16 factors compared between the two stocks.

About Northern Trust

Northern Trust Corporation, a financial holding company, provides wealth management, asset servicing, asset management, and banking solutions for corporations, institutions, families, and individuals worldwide. It operates in two segments, Asset Servicing and Wealth Management. The Asset Servicing segment offers asset servicing and related services, including custody, fund administration, investment operations outsourcing, investment management, investment risk and analytical services, employee benefit services, securities lending, foreign exchange, treasury management, brokerage services, transition management services, banking, and cash management services. This segment serves corporate and public retirement funds, foundations, endowments, fund managers, insurance companies, sovereign wealth funds, and other institutional investors. The Wealth Management segment offers trust, investment management, custody, and philanthropic; financial consulting; guardianship and estate administration; family business consulting; family financial education; brokerage services; and private and business banking services. This segment serves high-net-worth individuals and families, business owners, executives, professionals, retirees, and established privately held businesses. The company also provides asset management services, such as active and passive equity; active and passive fixed income; cash management; muti-asset and alternative asset classes comprising private equity and hedge funds of funds; and multi-manager advisory services and products through separately managed accounts, bank common and collective funds, registered investment companies, exchange traded funds, non-U.S. collective investment funds, and unregistered private investment funds. In addition, it offers overlay and other risk management services. Northern Trust Corporation was founded in 1889 and is headquartered in Chicago, Illinois.

About Oaktree Specialty Lending

Oaktree Specialty Lending Corporation is a business development company. The fund specializing in investments in middle market, bridge financing, first and second lien debt financing, unsecured and mezzanine loan, mezzanine debt, senior and junior secured debt, expansions, sponsor-led acquisitions, preferred equity, and management buyouts in small and mid-sized companies. It seeks to invest in education services, business services, retail and consumer, healthcare, manufacturing, food and restaurants, construction and engineering. The firm also seeks investment in media, advertising sectors, software, IT services, pharmaceuticals, biotechnology, real estate management and development, chemicals, machinery, and internet and direct marketing retail sectors. It invests between $5 million to $75 million principally in the form of one-stop, first lien, and second lien debt investments, which may include an equity co-investment component in companies. The firm invest in companies having enterprise value between $20 million and $150 million and EBITDA between $3 million and $50 million. The fund has a hold size of up to $75 million and may underwrite transactions up to $100 million. It primarily invests in North America. The fund seeks to be a lead investor in its portfolio companies.