Chicago Atlantic BDC (NASDAQ:LIEN – Get Free Report) and Charles Schwab (NYSE:SCHW – Get Free Report) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, valuation, dividends, profitability, analyst recommendations, institutional ownership and risk.
Valuation & Earnings
This table compares Chicago Atlantic BDC and Charles Schwab”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Chicago Atlantic BDC | $54.30 million | 4.07 | $33.28 million | $1.39 | 6.97 |
| Charles Schwab | $23.92 billion | 7.06 | $8.85 billion | $5.50 | 17.76 |
Insider and Institutional Ownership
4.4% of Chicago Atlantic BDC shares are held by institutional investors. Comparatively, 84.4% of Charles Schwab shares are held by institutional investors. 12.9% of Chicago Atlantic BDC shares are held by insiders. Comparatively, 6.3% of Charles Schwab shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Analyst Ratings
This is a summary of current ratings and price targets for Chicago Atlantic BDC and Charles Schwab, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Chicago Atlantic BDC | 0 | 1 | 0 | 0 | 2.00 |
| Charles Schwab | 1 | 3 | 16 | 1 | 2.81 |
Charles Schwab has a consensus target price of $121.17, suggesting a potential upside of 24.05%. Given Charles Schwab’s stronger consensus rating and higher possible upside, analysts plainly believe Charles Schwab is more favorable than Chicago Atlantic BDC.
Dividends
Chicago Atlantic BDC pays an annual dividend of $1.36 per share and has a dividend yield of 14.0%. Charles Schwab pays an annual dividend of $1.28 per share and has a dividend yield of 1.3%. Chicago Atlantic BDC pays out 97.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Charles Schwab pays out 23.3% of its earnings in the form of a dividend. Charles Schwab has increased its dividend for 1 consecutive years.
Profitability
This table compares Chicago Atlantic BDC and Charles Schwab’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Chicago Atlantic BDC | 52.82% | 11.66% | 10.21% |
| Charles Schwab | 38.79% | 24.53% | 2.14% |
Risk and Volatility
Chicago Atlantic BDC has a beta of 0.3, meaning that its stock price is 70% less volatile than the S&P 500. Comparatively, Charles Schwab has a beta of 0.76, meaning that its stock price is 24% less volatile than the S&P 500.
Summary
Charles Schwab beats Chicago Atlantic BDC on 14 of the 18 factors compared between the two stocks.
About Chicago Atlantic BDC
Chicago Atlantic BDC Inc. is a specialty finance company which has elected to be regulated as a business development company. Its investment objective is to maximize risk-adjusted returns on equity for its stockholders by investing primarily in direct loans to privately held middle-market companies, with a primary focus on cannabis companies. Chicago Atlantic BDC Inc., formerly known as CHICAGO ATLNTIC, is based in NEW YORK.
About Charles Schwab
The Charles Schwab Corporation, together with its subsidiaries, operates as a savings and loan holding company that provides wealth management, securities brokerage, banking, asset management, custody, and financial advisory services in the United States and internationally. The company operates in two segments, Investor Services and Advisor Services. It offers brokerage accounts with equity and fixed income trading, margin lending, options trading, futures and forex trading, and cash management capabilities, including certificates of deposit; third-party mutual funds through the Mutual Fund Marketplace and Mutual Fund OneSource service, as well as mutual fund trading and clearing services to broker-dealers; exchange-traded funds; advisory solutions for managed portfolios, separately managed accounts, customized personal advice for tailored portfolios, specialized planning, and full-time portfolio management; banking products comprising checking and savings accounts, first lien residential real estate mortgage loans, home equity lines of credit, and pledged asset lines; and trust custody services, personal trust reporting services, and administrative trustee services. It also provides digital retirement calculators; integrated web-, mobile-, and software-based trading platforms, real-time market data, options trading, premium research, and multi-channel access; self-service education and support tools; online research and analysis tools; equity compensation plan sponsors full-service recordkeeping for stock plans, stock options, restricted stock, performance shares, and stock appreciation rights; retirement plan services; mutual fund clearing services; and advisor services, including interactive tools and educational content. The Company operates through branch offices. The Charles Schwab Corporation was incorporated in 1971 and is headquartered in Westlake, Texas.
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