Contrasting MarketWise (NASDAQ:MKTW) & Barings Bdc (NYSE:BBDC)

MarketWise (NASDAQ:MKTW) and Barings Bdc (NYSE:BBDC) are both small-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, institutional ownership, valuation and dividends.

Insider and Institutional Ownership

23.0% of MarketWise shares are owned by institutional investors. Comparatively, 44.1% of Barings Bdc shares are owned by institutional investors. 29.9% of MarketWise shares are owned by insiders. Comparatively, 0.6% of Barings Bdc shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings for MarketWise and Barings Bdc, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MarketWise	0	1	1	0	2.50
Barings Bdc	0	4	1	0	2.20

Barings Bdc has a consensus price target of $9.50, suggesting a potential upside of 14.14%. Given Barings Bdc’s higher possible upside, analysts clearly believe Barings Bdc is more favorable than MarketWise.

Earnings and Valuation

This table compares MarketWise and Barings Bdc”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MarketWise	$328.12 million	0.91	$5.62 million	$0.88	21.40
Barings Bdc	$279.21 million	3.12	$101.92 million	$0.83	10.03

Barings Bdc has lower revenue, but higher earnings than MarketWise. Barings Bdc is trading at a lower price-to-earnings ratio than MarketWise, indicating that it is currently the more affordable of the two stocks.

Dividends

MarketWise pays an annual dividend of $1.00 per share and has a dividend yield of 5.3%. Barings Bdc pays an annual dividend of $1.04 per share and has a dividend yield of 12.5%. MarketWise pays out 113.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Barings Bdc pays out 125.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. MarketWise has raised its dividend for 1 consecutive years and Barings Bdc has raised its dividend for 3 consecutive years. Barings Bdc is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares MarketWise and Barings Bdc’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MarketWise	0.70%	-0.96%	1.10%
Barings Bdc	32.73%	10.07%	4.38%

Risk and Volatility

MarketWise has a beta of 0.21, meaning that its share price is 79% less volatile than the S&P 500. Comparatively, Barings Bdc has a beta of 0.64, meaning that its share price is 36% less volatile than the S&P 500.

Summary

Barings Bdc beats MarketWise on 10 of the 16 factors compared between the two stocks.

About MarketWise

MarketWise, Inc. operates a content and technology multi-brand platform for self-directed investors in the United States and Internationally. Its platform includes subscription businesses that provides financial research, software, education, and tools to navigate the financial markets. The company offers various investment strategies, such as value investing, income, growth, commodities, cryptocurrencies, venture, crowdfunded investing, biotechnology, mutual funds, options, and trading; investment research product portfolio through a range of media, including desktops, laptops, tablets, and mobile; and financial newsletters. It provides a suite of stock research tools and portfolio management services under the Chaikin Analytics brand; portfolio management software tools under the TradeSmith brand name; and database of accounting-based financial summaries under the Altimetry brand. In addition, the company develops screeners, monitors, portfolio management tools, and proprietary indicators that produce a composite score to rank publicly traded companies. The company was founded in 1999 and is headquartered in Baltimore, Maryland.

About Barings Bdc

Barings BDC, Inc. is a publicly traded, externally managed investment company that has elected to be treated as a business development company under the Investment Company Act of 1940. It seeks to invest primarily in senior secured loans, first lien debt, unitranche, second lien debt, subordinated debt, equity co-investments and senior secured private debt investments in private middle-market companies that operate across a wide range of industries. It specializes in mezzanine, leveraged buyouts, management buyouts, ESOPs, change of control transactions, acquisition financings, growth financing, and recapitalizations in lower middle market, mature, and later stage companies. It invests in manufacturing and distribution; business services and technology; transportation and logistics; consumer product and services. It invests in United States. It invests in companies with EBITDA of $10 million to $75 million, typically in private equity sponsor backed.