Goldman Sachs MLP Income Opportunities Fund (NYSE: GMZ) and Solar Capital (NASDAQ:SLRC) are both small-cap closed end funds companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, institutional ownership, valuation, profitability, dividends, earnings and analyst recommendations.
Solar Capital pays an annual dividend of $1.60 per share and has a dividend yield of 7.2%. Goldman Sachs MLP Income Opportunities Fund does not pay a dividend. Solar Capital pays out 95.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
This is a summary of current ratings and target prices for Goldman Sachs MLP Income Opportunities Fund and Solar Capital, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Goldman Sachs MLP Income Opportunities Fund||0||0||0||0||N/A|
Solar Capital has a consensus price target of $23.35, suggesting a potential upside of 5.23%. Given Solar Capital’s higher possible upside, analysts plainly believe Solar Capital is more favorable than Goldman Sachs MLP Income Opportunities Fund.
This table compares Goldman Sachs MLP Income Opportunities Fund and Solar Capital’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Goldman Sachs MLP Income Opportunities Fund||N/A||N/A||N/A|
Earnings and Valuation
This table compares Goldman Sachs MLP Income Opportunities Fund and Solar Capital’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Goldman Sachs MLP Income Opportunities Fund||N/A||N/A||N/A||N/A||N/A|
|Solar Capital||$151.84 million||6.18||$106.81 million||$1.68||13.21|
Solar Capital has higher revenue and earnings than Goldman Sachs MLP Income Opportunities Fund.
Institutional & Insider Ownership
62.9% of Solar Capital shares are held by institutional investors. 5.9% of Solar Capital shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Volatility & Risk
Goldman Sachs MLP Income Opportunities Fund has a beta of 1.56, suggesting that its share price is 56% more volatile than the S&P 500. Comparatively, Solar Capital has a beta of 0.55, suggesting that its share price is 45% less volatile than the S&P 500.
Solar Capital beats Goldman Sachs MLP Income Opportunities Fund on 9 of the 11 factors compared between the two stocks.
About Goldman Sachs MLP Income Opportunities Fund
Goldman Sachs MLP Income Opportunities Fund (the Fund) is a non-diversified, closed-end management investment company. The Fund seeks a high level of total return with an emphasis on current distributions to shareholders. The Fund seeks to achieve its investment objective by investing primarily in master limited partnerships (MLPs). Under normal market conditions, the Fund will invest at least 80% of its managed assets in MLP investments. The Fund may invest up to 20% of its managed assets in non-MLP investments, including, without limitation, securities of corporations that operate in the energy sector or that hold energy assets. The Fund may also invest in securities and other instruments issued by income and royalty trusts and other issuers. Goldman Sachs Asset Management, L.P., serves as investment adviser of the Fund.
About Solar Capital
Solar Capital Ltd. is a closed-end, externally managed, non-diversified management investment company. The Company’s investment objective is to generate both current income and capital appreciation through debt and equity investments. It invests in privately held the United States middle market companies. It invests in leveraged middle market companies in the form of senior secured loans, unitranche loans, mezzanine loans and equity securities. It may also invest in public companies that are thinly traded. Its business is focused primarily on the direct origination of investments through portfolio companies or their financial sponsors. Its investments generally range between $5 million and $100 million each. In addition, the Company may invest a portion of its portfolio in other types of investments, which it refers to as opportunistic investments. The Company’s investment activities are managed by Solar Capital Partners, LLC (Solar Capital Partners or the Investment Advisor).
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