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HPS vs NPFD

HPS
John Hancock Preferred Income Fund III
NEUTRAL
Price
$14.55
Market Cap
$468.1M
Sector
Financial Services
AI Confidence
85%
NPFD
Nuveen Variable Rate Preferred & Income Fund
BULLISH
Price
$19.30
Market Cap
$466.4M
Sector
Financial Services
AI Confidence
75%

Valuation

P/E Ratio
HPS
12.44
NPFD
8.98
Forward P/E
HPS
--
NPFD
--
P/B Ratio
HPS
1.01
NPFD
0.95
P/S Ratio
HPS
9.13
NPFD
9.69
EV/EBITDA
HPS
--
NPFD
--

Profitability

Gross Margin
HPS
100.0%
NPFD
100.0%
Operating Margin
HPS
88.5%
NPFD
83.27%
Profit Margin
HPS
73.63%
NPFD
108.68%
ROE
HPS
8.14%
NPFD
10.73%
ROA
HPS
3.82%
NPFD
3.22%

Growth

Revenue Growth
HPS
1.1%
NPFD
6.8%
Earnings Growth
HPS
-5.1%
NPFD
23.6%

Financial Health

Debt/Equity
HPS
0.59
NPFD
0.56
Current Ratio
HPS
2.82
NPFD
0.42
Quick Ratio
HPS
1.48
NPFD
0.32

Dividends

Dividend Yield
HPS
9.07%
NPFD
9.73%
Payout Ratio
HPS
112.82%
NPFD
91.95%

AI Verdict

HPS NEUTRAL

HPS presents as a stable but stagnant income vehicle, characterized by a Piotroski F-Score of 6/9 indicating stable financial health. While the Graham Number of $19.45 suggests a defensive undervaluation, this is countered by a low growth-based intrinsic value of $8.19 and a bearish technical trend. The primary concern is a dividend payout ratio of 112.82%, which indicates the current 9.07% yield is unsustainable and being funded by capital rather than earnings. Overall, the fund is a classic yield trap with strong margins but declining earnings growth.

Strengths
Strong profit margins (73.63%) and operating margins (88.50%)
Trading near book value (P/B 1.01)
Low Debt/Equity ratio (0.59) compared to sector average (1.38)
Risks
Unsustainable dividend payout ratio (112.82%)
Negative earnings growth (-5.10% YoY and -4.80% Q/Q)
Stagnant revenue growth (1.10% YoY)
NPFD BULLISH

NPFD exhibits strong fundamental value, trading significantly below its Graham Number ($31.31) and Intrinsic Value ($63.42). The Piotroski F-Score of 6/9 indicates a stable financial health profile, while a Price-to-Book ratio of 0.95 suggests the fund is trading at a discount to its net asset value. Despite a bearish technical trend and a high payout ratio, the combination of a 9.73% yield and strong earnings growth (23.6%) makes it an attractive income-oriented value play.

Strengths
Significant undervaluation relative to Graham Number ($31.31) and Intrinsic Value ($63.42)
High dividend yield of 9.73% providing strong immediate income
Stable financial health as evidenced by a Piotroski F-Score of 6/9
Risks
Very high payout ratio (91.95%) leaves little margin for error in distribution sustainability
Bearish technical trend (0/100) suggests lack of immediate market momentum
Low current ratio (0.42) and quick ratio (0.32) indicate tight short-term liquidity

Compare Another Pair

HPS vs NPFD: Head-to-Head Comparison

This page compares John Hancock Preferred Income Fund III (HPS) and Nuveen Variable Rate Preferred & Income Fund (NPFD) across key fundamental metrics including valuation ratios, profitability margins, growth rates, financial health indicators, and dividend metrics. Each metric highlights the better-performing stock so you can quickly identify relative strengths and weaknesses.

Our AI engine independently analyzes each company's financials, competitive position, and market conditions to produce a verdict (Bullish, Neutral, or Bearish) along with key strengths and risks. Use this comparison alongside your own research to make informed investment decisions.

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