BlackRock LT Municipal Advantage Trust (NYSE: BTA) and Alcentra Capital Corp. (NASDAQ:ABDC) are both small-cap financials companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, analyst recommendations, institutional ownership, earnings, dividends and profitability.
Institutional & Insider Ownership
31.5% of Alcentra Capital Corp. shares are held by institutional investors. 5.0% of Alcentra Capital Corp. shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
This table compares BlackRock LT Municipal Advantage Trust and Alcentra Capital Corp.’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|BlackRock LT Municipal Advantage Trust||-45.66%||-3.37%||-2.00%|
|Alcentra Capital Corp.||-2.77%||11.13%||6.86%|
Alcentra Capital Corp. pays an annual dividend of $1.36 per share and has a dividend yield of 12.9%. BlackRock LT Municipal Advantage Trust does not pay a dividend. Alcentra Capital Corp. pays out -1,700.0% of its earnings in the form of a dividend.
Earnings and Valuation
This table compares BlackRock LT Municipal Advantage Trust and Alcentra Capital Corp.’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|BlackRock LT Municipal Advantage Trust||N/A||N/A||N/A||N/A||N/A|
|Alcentra Capital Corp.||N/A||N/A||N/A||($0.08)||-131.75|
This is a summary of current ratings and recommmendations for BlackRock LT Municipal Advantage Trust and Alcentra Capital Corp., as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|BlackRock LT Municipal Advantage Trust||2||6||7||0||2.33|
|Alcentra Capital Corp.||0||3||2||0||2.40|
BlackRock LT Municipal Advantage Trust presently has a consensus price target of $357.00, indicating a potential upside of 2,790.69%. Alcentra Capital Corp. has a consensus price target of $13.50, indicating a potential upside of 28.08%. Given BlackRock LT Municipal Advantage Trust’s higher possible upside, equities research analysts clearly believe BlackRock LT Municipal Advantage Trust is more favorable than Alcentra Capital Corp..
Alcentra Capital Corp. beats BlackRock LT Municipal Advantage Trust on 8 of the 10 factors compared between the two stocks.
About BlackRock LT Municipal Advantage Trust
BlackRock Long-Term Municipal Advantage Trust (the Trust) is a non-diversified, closed-end management investment company. The Trust’s investment objective is to provide current income exempt from regular federal income tax. The Trust seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its assets in municipal obligations and derivative instruments with exposure to such municipal obligations, in each case that are exempt from federal income tax (except that the interest may be subject to the federal alternative minimum tax). The Trust invests primarily in long-term municipal bonds with a maturity of more than 10 years at the time of investment. The Trust’s municipal bond portfolio will have a dollar-weighted average maturity of more than 10 years. The Trust may invest directly in such securities or synthetically through the use of derivatives. BlackRock Advisors, LLC is the investment manager of the Trust.
About Alcentra Capital Corp.
Alcentra Capital Corporation is a specialty finance company that operates as a non-diversified, closed-end management investment company. The Company operates as a business development company and a regulated investment company. It provides customized debt and equity financing solutions to lower middle-market companies, which are companies having annual earnings, before interest, taxes, depreciation and amortization of between $5 million and $15 million, and/or revenues of between $10 million and $100 million. Its investments range in size from $5 million to $15 million. Its investment objective is to generate both current income and capital appreciation primarily by making direct investments in lower middle-market companies in the form of senior debt, unitranche, second lien, subordinated debt and, to a lesser extent, senior debt and minority equity investments. Its investment focus is to make loans to, and selected equity investments in, privately-held lower-middle-market companies.
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