Comparing New Mountain Finance (NMFC) & Its Competitors

New Mountain Finance (NASDAQ:NMFC) is one of 1,746 public companies in the “Capital Markets” industry, but how does it compare to its peers? We will compare New Mountain Finance to similar businesses based on the strength of its valuation, institutional ownership, risk, profitability, analyst recommendations, earnings and dividends.

Volatility and Risk

New Mountain Finance has a beta of 0.58, indicating that its share price is 42% less volatile than the S&P 500. Comparatively, New Mountain Finance’s peers have a beta of 0.79, indicating that their average share price is 21% less volatile than the S&P 500.

Institutional and Insider Ownership

32.1% of New Mountain Finance shares are held by institutional investors. Comparatively, 30.6% of shares of all “Capital Markets” companies are held by institutional investors. 14.9% of New Mountain Finance shares are held by insiders. Comparatively, 13.1% of shares of all “Capital Markets” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

New Mountain Finance pays an annual dividend of $1.00 per share and has a dividend yield of 15.0%. New Mountain Finance pays out -185.2% of its earnings in the form of a dividend. As a group, “Capital Markets” companies pay a dividend yield of 3.2% and pay out 29.2% of their earnings in the form of a dividend. New Mountain Finance is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.

Profitability

This table compares New Mountain Finance and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
New Mountain Finance	-21.29%	10.71%	4.55%
New Mountain Finance Competitors	314.79%	9.90%	3.46%

Analyst Ratings

This is a breakdown of current ratings and recommmendations for New Mountain Finance and its peers, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
New Mountain Finance	2	4	0	0	1.67
New Mountain Finance Competitors	5605	20212	22565	650	2.37

New Mountain Finance currently has a consensus price target of $7.50, suggesting a potential upside of 12.36%. As a group, “Capital Markets” companies have a potential upside of 23.42%. Given New Mountain Finance’s peers stronger consensus rating and higher probable upside, analysts clearly believe New Mountain Finance has less favorable growth aspects than its peers.

Valuation & Earnings

This table compares New Mountain Finance and its peers top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
New Mountain Finance	-$58.84 million	$16.49 million	-12.36
New Mountain Finance Competitors	$3.11 billion	$397.40 million	15.16

New Mountain Finance’s peers have higher revenue and earnings than New Mountain Finance. New Mountain Finance is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Summary

New Mountain Finance peers beat New Mountain Finance on 9 of the 15 factors compared.

New Mountain Finance Company Profile

New Mountain Finance Corporation is a business development company that provides financing to U.S. middle-market businesses. It is externally managed by an affiliate of New Mountain Capital, an alternative investment manager. The company primarily invests in senior secured loans, along with other debt investments and, in some cases, equity securities. Its financing supports businesses across a range of industries and may be used for purposes such as growth, acquisitions, refinancing, or ownership changes.