Reviewing OFS Capital (OFS) and Molori Energy (MOLOF)

OFS Capital (NASDAQ:OFS) and Molori Energy (OTCMKTS:MOLOF) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, risk, profitability, earnings, dividends, analyst recommendations and valuation.

Profitability

This table compares OFS Capital and Molori Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
OFS Capital 22.35% 10.16% 4.55%
Molori Energy N/A N/A N/A

Dividends

OFS Capital pays an annual dividend of $1.36 per share and has a dividend yield of 11.3%. Molori Energy does not pay a dividend. OFS Capital 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.

Earnings and Valuation

This table compares OFS Capital and Molori Energy’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
OFS Capital $42.83 million 3.75 $9.57 million $1.38 8.70
Molori Energy $110,000.00 14.72 $1.73 million N/A N/A

OFS Capital has higher revenue and earnings than Molori Energy.

Risk & Volatility

OFS Capital has a beta of 0.69, meaning that its share price is 31% less volatile than the S&P 500. Comparatively, Molori Energy has a beta of 1.36, meaning that its share price is 36% more volatile than the S&P 500.

Insider & Institutional Ownership

22.4% of OFS Capital shares are owned by institutional investors. 0.0% of OFS Capital shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings for OFS Capital and Molori Energy, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
OFS Capital 0 0 1 0 3.00
Molori Energy 0 0 0 0 N/A

OFS Capital currently has a consensus price target of $15.00, suggesting a potential upside of 24.90%. Given OFS Capital’s higher possible upside, research analysts clearly believe OFS Capital is more favorable than Molori Energy.

Summary

OFS Capital beats Molori Energy on 10 of the 13 factors compared between the two stocks.

About OFS Capital

OFS Capital Corporation is a business development company specializing in direct and fund investments as well as add-on acquisitions. It does not invest in operational turnarounds or start-up businesses. For direct, it specializes in debt and structured equity investments, recapitalizations and refinancing, management and leveraged buyouts, acquisition financings, shareholder liquidity events, growth capital, independent sponsor transactions, ESOPs, and minority investments in the lower middle market companies. It invests in the aerospace and defense, business services, consumer products and services, food and beverage, health care services, specialty chemicals, transportation and logistics, distribution, franchising, and industrial and niche manufacturing sectors. The fund invests in companies based in United States. It seeks to invest between $3 million and $20 million in companies with revenues between $10 million and $200 million, Annual EBITDA between $3 million and $30 million, and Enterprise value between $10 million and $500 million. The fund seeks to invest in companies with debt values between $5 million and $25 million. The fund uses senior secured, unitranche loans, first-lien, second-lien, mezzanine loans, warrants, and preferred equity securities and common equity securities. It prefers to take a minority stake in the investments made. It also co-invests with its partners for additional capital.

About Molori Energy

Molori Energy Inc. operates as an oil and gas production company in Texas, the United States. It owns working interest in various oil and gas leases located in the Texas Panhandle. The company was formerly known as Taipan Resources Inc. and changed its name to Molori Energy Inc. in January 2017. Molori Energy Inc. was incorporated in 2006 and is headquartered in Vancouver, Canada.

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