Head to Head Contrast: Triangle Capital (TCAP) and The Carlyle Group (CG)

The Carlyle Group (NYSE: TCAP) and Triangle Capital (NYSE:TCAP) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, dividends, profitability, valuation, risk and earnings.

Dividends

The Carlyle Group pays an annual dividend of $0.88 per share and has a dividend yield of 3.8%. Triangle Capital pays an annual dividend of $1.20 per share and has a dividend yield of 10.2%. The Carlyle Group pays out 25.4% of its earnings in the form of a dividend. Triangle Capital pays out 77.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Volatility and Risk

The Carlyle Group has a beta of 1.76, suggesting that its share price is 76% more volatile than the S&P 500. Comparatively, Triangle Capital has a beta of 0.75, suggesting that its share price is 25% less volatile than the S&P 500.

Insider and Institutional Ownership

40.5% of The Carlyle Group shares are held by institutional investors. Comparatively, 50.1% of Triangle Capital shares are held by institutional investors. 3.5% of Triangle Capital shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares The Carlyle Group and Triangle Capital’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
The Carlyle Group 6.37% 31.20% 6.42%
Triangle Capital -17.98% 10.25% 5.54%

Earnings and Valuation

This table compares The Carlyle Group and Triangle Capital’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
The Carlyle Group $3.68 billion 0.65 $244.10 million $3.47 6.76
Triangle Capital $123.00 million 4.61 -$28.65 million $1.55 7.61

The Carlyle Group has higher revenue and earnings than Triangle Capital. The Carlyle Group is trading at a lower price-to-earnings ratio than Triangle Capital, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations and price targets for The Carlyle Group and Triangle Capital, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
The Carlyle Group 0 1 8 0 2.89
Triangle Capital 3 4 2 0 1.89

The Carlyle Group currently has a consensus price target of $29.33, suggesting a potential upside of 25.09%. Triangle Capital has a consensus price target of $12.88, suggesting a potential upside of 9.11%. Given The Carlyle Group’s stronger consensus rating and higher probable upside, equities analysts clearly believe The Carlyle Group is more favorable than Triangle Capital.

Summary

The Carlyle Group beats Triangle Capital on 11 of the 16 factors compared between the two stocks.

About The Carlyle Group

The Carlyle Group LP is an investment firm specializing in direct and fund of fund investments in Fintech sector. Within direct investments, it specializes in management-led/ Leveraged buyouts, privatizations, divestitures, strategic minority equity investments, structured credit, global distressed and corporate opportunities, small and middle market, equity private placements, consolidations and buildups, senior debt, mezzanine and leveraged finance, and venture and growth capital financings, seed/startup, early venture, emerging growth, turnaround, mid venture, late venture, PIPES. The firm invests across four segments which include Corporate Private Equity, Real Assets, Global Market Strategies, and Solutions. The firm typically invests in agribusiness, ecological sector, airports, parking, Plastics, Rubber, diversified natural resources, minerals, farming, aerospace, defense, automotive, consumer, retail, industrial, infrastructure, energy, power, healthcare, software, software enabled services, semiconductors, communications infrastructure, financial technology, utilities, gaming, systems and related supply chain, electronic systems, systems, oil and gas, processing facilities, power generation assets, technology, systems, real estate, financial services, transportation, business services, telecommunications, media, and logistics sectors. Within the industrial sector, the firm invests in manufacturing, building products, packaging, chemicals, metals and mining, forestry and paper products, and industrial consumables and services. In consumer and retail sectors, it invests in food and beverage, retail, restaurants, consumer products, domestic consumption, consumer services, personal care products, direct marketing, and education. Within aerospace, defense, business services, and government services sectors, it seeks to invest in defense electronics, manufacturing and services, government contracting and services, information technology, distribution companies. In telecommunication and media sectors, it invests in cable TV, directories, publishing, entertainment and content delivery services, wireless infrastructure/services, fixed line networks, satellite services, broadband and Internet, and infrastructure. Within real estate, the firm invests in office, hotel, industrial, retail, for sale residential, student housing, hospitality, multifamily residential, homebuilding and building products, and senior living sectors. The firm seeks to make investments in growing business including those with overleveraged balance sheets. The firm seeks to hold its investments for four to six years. In the healthcare sector, it invests in healthcare services, outsourcing services, companies running clinical trials for pharmaceutical companies, managed care, pharmaceuticals, pharmaceutical related services, healthcare IT, medical, products, and devices. It seeks to invest in companies based in Sub-Saharan focusing on Ghana, Kenya, Mozambique, Botswana, Nigeria, Uganda, West Africa, North Africa and South Africa focusing on Tanzania and Zambia; Asia focusing on Pakistan, India, South East Asia, Indonesia, Philippines, Vietnam, Korea, and Japan; Australia; New Zealand; Europe focusing on France, Italy, Denmark, United Kingdom, Germany, Austria, Belgium, Finland, Iceland, Ireland, Netherlands, Norway, Portugal, Spain, Benelux , Sweden, Switzerland, Hungary, Poland, and Russia; Middle East focusing on Bahrain, Jordan, Kuwait, Lebanon, Oman, Qatar, Saudi Arabia, Turkey, and UAE; North America focusing on United States which further invest in Southeastern United States, Texas, Boston, San Francisco Bay Area and Pacific Northwest; Asia Pacific; Soviet Union, Central-Eastern Europe, and Israel; Nordic region; and South America focusing on Mexico, Argentina, Brazil, Chile, and Peru. The firm seeks to invest in food, financial, and healthcare industries in Western China. In the real estate sector, the firm seeks to invest in various locations across Europe focusing on France and Central Europe, United States, Asia focusing on China, and Latin America. It typically invests between $5 million and $50 million for venture investments and between $20 million and $1 billion for buyouts in companies with enterprise value of between $37.15 million and $1000 million and sales value of $10 million and $500 million. It seeks to invest in companies with market capitalization greater than $50 million. It prefers to take a majority stake. It typically holds its investments for three to five years. Within automotive and transportation sectors, the firm seeks to hold its investments in for four to six years. While investing in Japan, it does not invest in companies with more than 1,000 employees and prefers companies' worth between $100 million and $150 million. The firm originates, structures, and acts as lead equity investor in the transactions. The Carlyle Group LP was founded in 1987 and is based in Washington, District of Columbia with additional offices in 20 countries across six continents (North America, South America, Asia, Australia, Europe, and Africa).

About Triangle Capital

Triangle Capital Corporation is a business development company specializing in private equity and mezzanine investments. It focuses on leveraged buyouts, management buyouts, ESOPs, change of control transactions, acquisition financings, growth financing, and recapitalizations in lower middle market, mature, and later stage companies. The firm prefers to make investments in many business sectors including manufacturing, distribution, transportation, energy, communications, health services, restaurants, media, and others. It primarily invests in companies located throughout the United States, with an emphasis on the Southeast and Midatlantic. The firm makes equity investments between $1 million and $25 million and debt investments between $5 million and $30 million per transaction, in companies having annual revenues between $20 million and $200 million and EBITDA between $3 million and $35 million and can also co-invest. It typically makes investments between $5 million and $35 million. It primarily invests in senior subordinated debt securities secured by second lien security interests in portfolio company assets, coupled with equity interests. The firm also invests in senior debt securities secured by first lien security interests in portfolio companies. Triangle Capital Corporation was incorporated on October 10, 2006 and is based in Raleigh, North Carolina.

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