Deutsche Strategic Income Trust (KST) versus Goldman Sachs BDC (GSBD) Financial Review

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Deutsche Strategic Income Trust (NYSE:KST) and Goldman Sachs BDC (NYSE:GSBD) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, earnings, dividends, profitability, valuation and risk.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Deutsche Strategic Income Trust and Goldman Sachs BDC, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Deutsche Strategic Income Trust 0 0 0 0 N/A
Goldman Sachs BDC 1 2 4 1 2.63

Goldman Sachs BDC has a consensus target price of $22.63, indicating a potential upside of 1.78%. Given Goldman Sachs BDC’s higher possible upside, analysts clearly believe Goldman Sachs BDC is more favorable than Deutsche Strategic Income Trust.

Valuation & Earnings

This table compares Deutsche Strategic Income Trust and Goldman Sachs BDC’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Deutsche Strategic Income Trust N/A N/A N/A N/A N/A
Goldman Sachs BDC $136.78 million 6.53 $49.54 million $2.07 10.74

Goldman Sachs BDC has higher revenue and earnings than Deutsche Strategic Income Trust.

Insider and Institutional Ownership

54.4% of Deutsche Strategic Income Trust shares are held by institutional investors. Comparatively, 33.9% of Goldman Sachs BDC shares are held by institutional investors. 1.0% of Deutsche Strategic Income Trust shares are held by insiders. Comparatively, 0.3% of Goldman Sachs BDC shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Dividends

Deutsche Strategic Income Trust pays an annual dividend of $0.53 per share and has a dividend yield of 4.2%. Goldman Sachs BDC pays an annual dividend of $1.80 per share and has a dividend yield of 8.1%. Goldman Sachs BDC pays out 87.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Goldman Sachs BDC has increased its dividend for 2 consecutive years. Goldman Sachs BDC is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Deutsche Strategic Income Trust and Goldman Sachs BDC’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Deutsche Strategic Income Trust N/A N/A N/A
Goldman Sachs BDC 46.38% 10.93% 6.12%

Risk and Volatility

Deutsche Strategic Income Trust has a beta of 0.29, indicating that its stock price is 71% less volatile than the S&P 500. Comparatively, Goldman Sachs BDC has a beta of 0.82, indicating that its stock price is 18% less volatile than the S&P 500.

Summary

Goldman Sachs BDC beats Deutsche Strategic Income Trust on 10 of the 13 factors compared between the two stocks.

Deutsche Strategic Income Trust Company Profile

There is no company description available for DWS Strategic Income Trust.

Goldman Sachs BDC Company Profile

Goldman Sachs BDC, Inc. is a business development company specializing in middle market and mezzanine investment in private companies. It seeks to make capital appreciation through direct originations of secured debt, senior secured debt, junior secured debt, including first lien, first lien/last-out unitranche and second lien debt, unsecured debt, including mezzanine debt and, to a lesser extent, investments in equities. The fund primarily invests in United States. It seeks to invest between $10 million and $75 million in companies with EBITDA between $5 million and $75 million annually.

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