Reviewing Information Services Group, Inc. Common Stock (NASDAQ:III) and Blackrock Capital Investment (BKCC)

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Information Services Group, Inc. Common Stock (NASDAQ: III) and Blackrock Capital Investment (NASDAQ:BKCC) are both small-cap business services companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, dividends, profitability, risk, earnings, analyst recommendations and institutional ownership.

Insider & Institutional Ownership

43.0% of Information Services Group, Inc. Common Stock shares are owned by institutional investors. Comparatively, 38.3% of Blackrock Capital Investment shares are owned by institutional investors. 12.7% of Information Services Group, Inc. Common Stock shares are owned by insiders. Comparatively, 1.3% of Blackrock Capital Investment shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Information Services Group, Inc. Common Stock and Blackrock Capital Investment, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Information Services Group, Inc. Common Stock 0 0 3 0 3.00
Blackrock Capital Investment 0 1 1 0 2.50

Information Services Group, Inc. Common Stock currently has a consensus target price of $6.25, indicating a potential upside of 50.24%. Blackrock Capital Investment has a consensus target price of $7.25, indicating a potential upside of 16.56%. Given Information Services Group, Inc. Common Stock’s stronger consensus rating and higher probable upside, analysts clearly believe Information Services Group, Inc. Common Stock is more favorable than Blackrock Capital Investment.

Profitability

This table compares Information Services Group, Inc. Common Stock and Blackrock Capital Investment’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Information Services Group, Inc. Common Stock -0.50% 12.01% 3.40%
Blackrock Capital Investment 6.07% 9.02% 6.02%

Earnings and Valuation

This table compares Information Services Group, Inc. Common Stock and Blackrock Capital Investment’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Information Services Group, Inc. Common Stock $269.55 million 0.68 -$2.13 million $0.16 26.00
Blackrock Capital Investment $97.33 million 4.62 $20.90 million $0.73 8.52

Blackrock Capital Investment has lower revenue, but higher earnings than Information Services Group, Inc. Common Stock. Blackrock Capital Investment is trading at a lower price-to-earnings ratio than Information Services Group, Inc. Common Stock, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Information Services Group, Inc. Common Stock has a beta of 0.16, suggesting that its stock price is 84% less volatile than the S&P 500. Comparatively, Blackrock Capital Investment has a beta of 0.67, suggesting that its stock price is 33% less volatile than the S&P 500.

Dividends

Blackrock Capital Investment pays an annual dividend of $0.72 per share and has a dividend yield of 11.6%. Information Services Group, Inc. Common Stock does not pay a dividend. Blackrock Capital Investment pays out 98.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Information Services Group, Inc. Common Stock beats Blackrock Capital Investment on 9 of the 16 factors compared between the two stocks.

About Information Services Group, Inc. Common Stock

Information Services Group, Inc. operates as a technology research and advisory company in the Americas, Europe, and the Asia Pacific. The company offers digital transformation services, including automation, cloud, and data analytics; sourcing advisory; managed governance and risk; network carrier; technology strategy and operations design; change management; and market intelligence and technology research and analysis services. It supports private and public sector organizations to transform and optimize their operational environments. The company serves private sector clients operating in the financial services, telecommunications, healthcare and pharmaceuticals, manufacturing, transportation and travel, and energy and utilities industries; and public sector customers, including state and local governments, airport and transit authorities, and national and provincial government units. Information Services Group, Inc. was founded in 2006 and is headquartered in Stamford, Connecticut.

About Blackrock Capital Investment

BlackRock Capital Investment Corporation is an externally-managed, non-diversified, closed-end management investment company. The Company’s investment objective is to generate both current income and capital appreciation through its debt and equity investments. The Company provides middle-market companies with a range of financing solutions, including senior and junior secured, unsecured and subordinated debt securities and loans, and equity securities. Its targeted investment typically ranges between $10 million and $50 million. The Company generally seeks to invest in companies that operate in a range of industries. The Company’s investments are in senior and junior secured, unsecured and subordinated loans to the United States private and certain public middle-market companies. The Company’s investment advisor is BlackRock Advisors, LLC.

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