Will Saratoga Investment (USA Stocks:SAR) shadow BlackRock TCP price growth?

Analyzing basic indicators between Saratoga Investment and BlackRock allows us to compare the impact of market volatilities on both companies' prices and assess if combining them in a portfolio can diversify market risk. Pair trading strategies can also be used, matching a long position in BlackRock with a short position in Saratoga Investment. More information is available in our pair correlation module. Focusing on Saratoga Investment, its asset utilization ratio stands at 12.08 percent, indicating that the company generates $0.12 for each dollar of assets. An increasing asset utilization ratio suggests that Saratoga Investment Corp is becoming more efficient in using its assets for daily operations.

Main Points

Saratoga Investment Corp (SAR) has shown promising performance with a five-year return of 8.41% and a quarterly revenue growth of 15.2%. Despite a higher debt-to-equity ratio of 1.84%, the company's robust total revenue of $143.9M and net asset of $1.19B indicate a strong financial position that could potentially outpace BlackRock TCP in stock price appreciation.
Published over a week ago
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Reviewed by Raphi Shpitalnik

Saratoga Investment Corp (SAR), a key player in the Capital Markets sector, has been showing a promising trajectory in the Asset Management industry. With a five-year return of 8.41%, the company has demonstrated a solid track record of performance. The firm's operating margin stands at 0.73%, indicating a relatively efficient operation. Saratoga's book value per share is at 27.12X, and with a price to book ratio of 0.88X, the stock appears undervalued, suggesting potential for price appreciation. However, the company's current ratio of 0.46X indicates a potential liquidity risk, which investors should consider. The company's net income from continuing operations stands at $8.9 million, a respectable figure given the challenging market conditions. Furthermore, Saratoga's total debt is $803.67 million, which, when compared to its cash and equivalents of $96.08 million, suggests the company has a manageable debt load. In comparison to BlackRock TCP, Saratoga's performance and potential for stock price appreciation will depend on its ability to maintain its operating efficiency, manage its debt effectively, and capitalize on its undervalued status. However, investors should keep an eye on the company's liquidity risk, as indicated by its current ratio. We're focusing on the capital markets space, specifically examining Saratoga Investment and BlackRock TCP as potential short-term opportunities. We'll discuss competitive aspects of both companies.
Investment perspective, in general, refers to a viewpoint or opinion regarding investment opportunity in Saratoga Investment. It encompasses the assessment of an investment's potential risks and rewards, and expectations for its performance over time. Several factors influence the investment perspective on Saratoga Investment, including investment goals, risk tolerance, time horizon, market conditions, and research and analysis. Investors have varying goals, such as capital preservation, income generation, or long-term growth. Risk tolerance plays a significant role in shaping an investor's perspective, with some being more risk-averse and others willing to take on higher risks for potential returns.

How important is Saratoga Investment's Liquidity

Saratoga Investment financial leverage refers to using borrowed capital as a funding source to finance Saratoga Investment Corp ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Saratoga Investment financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Saratoga Investment's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Saratoga Investment's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Saratoga Investment's total debt and its cash.

Saratoga Investment Gross Profit

Saratoga Investment Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Saratoga Investment previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Saratoga Investment Gross Profit growth over the last 10 years. Please check Saratoga Investment's gross profit and other fundamental indicators for more details.

Breaking down Saratoga Investment Indicators

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include products or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Lets now take a look at Saratoga Investment revenue. Based on the latest financial disclosure, Saratoga Investment Corp reported 143.87 M of revenue.
This is 98.72% lower than that of the Capital Markets sector and 97.32% lower than that of the Financials industry. The revenue for all United States stocks is 98.48% higher than that of Saratoga Investment. As for BlackRock TCP we see revenue of 177.68 M, which is 96.68% lower than that of the Financials
5.4 B
SAR143.87 Million2.53
Sector5.36 Billion94.34
TCPC177.68 Million3.13
As Warren Buffet wisely noted, price is what you pay, value is what you get. In the case of Saratoga Investment Corp (SAR), the value seems to be promising. With a solid five-year return of 8.41% and a robust operating income of $59.2M, SAR is showing signs of strength in the asset management industry. However, its current ratio of 0.46X indicates a potential liquidity issue, which could hinder its ability to outpace BlackRock TCP in stock price appreciation. Despite this, with a target price of $25.39, significantly higher than its day typical price of $22.74, SAR may still offer an attractive investment opportunity..

Saratoga Investment is estimated to stay under $23 in August

Saratoga Investment Corp, a prominent financial services firm, recently showed a downside variance of 0.67, indicating a potential rise in stock price volatility. This uncertainty suggests that Saratoga's stock may stay under $23 throughout August. Given this, investors should cautiously consider this price limit for short-term investment decisions. Saratoga Investment Corp exhibits low volatility, with a Treynor Ratio of 0.11, Maximum Drawdown of 4.76, and kurtosis of 1.67. Understanding market volatility trends can assist investors in timing the market. Utilizing volatility indicators correctly allows traders to assess Saratoga Investment's stock risk during both bullish and bearish trends.
The heightened volatility during bear markets can impact Saratoga Investment's stock price, causing investor stress as share values drop. This often leads investors to diversify their portfolios by purchasing different financial instruments as prices decline.In conclusion, despite the recent slump, Saratoga Investment Corp (SAR) still holds potential for investors. The stock has a strong buy consensus from analysts, with 2 strong buys, 1 buy, and 5 holds. The analyst target price estimated value stands at $27.89, with the highest estimated target price reaching up to $30.96. However, investors should also consider the possible downside price of $21.87. The valuation real value is currently at $25.33, slightly above the analyst's lowest estimated target price of $25.38. Therefore, while the stock has experienced a downturn, the overall consensus suggests that SAR could be a valuable addition to an investment portfolio..

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Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Nico Santiago do not own shares of Saratoga Investment Corp. Please refer to our Terms of Use for any information regarding our disclosure principles.

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