TPG Specialty Lending (TSLX) versus The Competition Financial Analysis

TPG Specialty Lending (NYSE: TSLX) is one of 547 public companies in the “Closed End Funds” industry, but how does it compare to its peers? We will compare TPG Specialty Lending to similar companies based on the strength of its risk, profitability, valuation, earnings, analyst recommendations, dividends and institutional ownership.

Valuation and Earnings

This table compares TPG Specialty Lending and its peers top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
TPG Specialty Lending $192.41 million $107.33 million 10.42
TPG Specialty Lending Competitors $238.79 million $43.51 million 299.47

TPG Specialty Lending’s peers have higher revenue, but lower earnings than TPG Specialty Lending. TPG Specialty Lending 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.

Dividends

TPG Specialty Lending pays an annual dividend of $1.56 per share and has a dividend yield of 7.6%. TPG Specialty Lending pays out 79.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Closed End Funds” companies pay a dividend yield of 8.4% and pay out 267.1% of their earnings in the form of a dividend.

Institutional & Insider Ownership

62.7% of TPG Specialty Lending shares are held by institutional investors. Comparatively, 23.8% of shares of all “Closed End Funds” companies are held by institutional investors. 4.8% of TPG Specialty Lending shares are held by insiders. Comparatively, 5.1% of shares of all “Closed End Funds” companies are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares TPG Specialty Lending and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TPG Specialty Lending 56.43% 12.63% 7.53%
TPG Specialty Lending Competitors -41.16% 6.93% 5.37%

Analyst Ratings

This is a breakdown of recent ratings and target prices for TPG Specialty Lending and its peers, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TPG Specialty Lending 0 1 2 0 2.67
TPG Specialty Lending Competitors 233 1562 1913 31 2.47

TPG Specialty Lending currently has a consensus target price of $21.33, indicating a potential upside of 4.42%. As a group, “Closed End Funds” companies have a potential upside of 43.52%. Given TPG Specialty Lending’s peers higher probable upside, analysts plainly believe TPG Specialty Lending has less favorable growth aspects than its peers.

Risk & Volatility

TPG Specialty Lending has a beta of 0.69, suggesting that its share price is 31% less volatile than the S&P 500. Comparatively, TPG Specialty Lending’s peers have a beta of 0.56, suggesting that their average share price is 44% less volatile than the S&P 500.

Summary

TPG Specialty Lending beats its peers on 9 of the 15 factors compared.

About TPG Specialty Lending

TPG Specialty Lending, Inc. is an externally managed, closed-end, non-diversified management investment company. The Company is a specialty finance company focused on lending to middle-market companies. It seeks to generate current income primarily in the United States-domiciled middle-market companies through direct originations of senior secured loans and originations of mezzanine and unsecured loans and investments in corporate bonds and equity securities. The Company invests in first-lien debt, second-lien debt, mezzanine and unsecured debt and equity and other investments. Its first-lien debt may include standalone first-lien loans; last out first-lien loans; unitranche loans and secured corporate bonds. Its second-lien debt may include secured loans and secured corporate bonds, with a secondary priority behind first-lien debt. As of December 31, 2016, the Company’s portfolio was invested across 19 different industries. The Company’s investment advisor is TSL Advisers, LLC.

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