THL Credit Inc. (TCRD) Stock Rating Reaffirmed by National Securities
THL Credit Inc. (NASDAQ:TCRD)‘s stock had its “neutral” rating reaffirmed by research analysts at National Securities in a report released on Friday. They presently have a $11.00 price target on the investment management company’s stock. National Securities’ price objective would indicate a potential upside of 14.35% from the company’s current price.
The analysts wrote, “3Q16 Recap: THL Credit (TCRD) reported NII/share of $0.32 for 3Q16, falling a penny short of consensus and our own estimate of $0.33/share. Non-accruals as a percentage of amortized cost decreased Q/Q to 3.1% from 7.6% the quarter prior. The company’s previous unrealized depreciation shifted into realized losses pertaining to the restructuring of Tri Starr. THL experienced unrealized appreciation of $24.7 million and realized losses of $25.0 million. NAV/share stabilized, decreasing 4 cents per share Q/Q to $11.84. We expect NAV/share to continue to improve from less problem assets going forward due to the greater focus on sponsored investments and first lien assets. This shift in investment type will likely weigh on NIM (net investment margin) and effective yields through the remainder of 2016 and 2017. As a result of the likely spread compression the quarterly dividend was reduced 21% Q/Q to $0.27/share from $0.34/share previously – we had forecasted a reduction to $0.31/share in 1Q17. We are adjusting our 2016 NII/share estimate from $1.42 to $1.36 and our 2017 NII/share estimate from $1.31 to $1.17. We are maintaining our NEUTRAL rating and $11 price target. Our $11 price target implies an estimated 2017 Price/Net Investment Income (P/NII) of 9.4x, dividend yield of 9.8%, and Price/Net Asset Value (P/NAV) of 0.90x compared to the BDC sector averages of 9.6x, 10.0%, and 0.87x, respectively. “
Other equities research analysts have also recently issued reports about the stock. Deutsche Bank AG reduced their target price on shares of THL Credit from $12.25 to $12.00 and set a “buy” rating for the company in a report on Thursday, August 11th. Zacks Investment Research raised shares of THL Credit from a “strong sell” rating to a “hold” rating in a report on Tuesday, October 11th. Jefferies Group reaffirmed a “hold” rating on shares of THL Credit in a report on Friday, August 12th. Keefe, Bruyette & Woods cut shares of THL Credit from an “outperform” rating to a “market perform” rating and reduced their target price for the company from $12.50 to $11.50 in a report on Monday, August 8th. Finally, Wells Fargo & Co. cut shares of THL Credit from an “outperform” rating to a “market perform” rating in a report on Friday, August 5th. Eight analysts have rated the stock with a hold rating and four have assigned a buy rating to the stock. The company presently has a consensus rating of “Hold” and an average target price of $11.80.
THL Credit (NASDAQ:TCRD) opened at 9.62 on Friday. The firm’s 50 day moving average price is $9.39 and its 200-day moving average price is $10.40. THL Credit has a 1-year low of $8.58 and a 1-year high of $11.95.
THL Credit (NASDAQ:TCRD) last released its quarterly earnings data on Wednesday, November 9th. The investment management company reported $0.32 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.33 by $0.01. THL Credit had a net margin of 5.92% and a return on equity of 11.72%. The company earned $21.60 million during the quarter, compared to analyst estimates of $20.47 million. During the same quarter in the prior year, the company earned $0.35 EPS. The business’s revenue was down 6.5% on a year-over-year basis. Equities analysts expect that THL Credit will post $1.41 earnings per share for the current year.
The business also recently announced a quarterly dividend, which will be paid on Friday, December 30th. Shareholders of record on Thursday, December 15th will be given a dividend of $0.27 per share. The ex-dividend date of this dividend is Tuesday, December 13th. This represents a $1.08 annualized dividend and a yield of 11.23%. THL Credit’s payout ratio is currently 850.05%.
A number of hedge funds and other institutional investors have recently modified their holdings of the company. Airain ltd bought a new position in shares of THL Credit during the third quarter valued at $100,000. M&T Bank Corp acquired a new stake in THL Credit during the third quarter valued at approximately $100,000. Acrospire Investment Management LLC acquired a new stake in THL Credit during the third quarter valued at approximately $108,000. Citadel Advisors LLC acquired a new stake in THL Credit during the third quarter valued at approximately $130,000. Finally, Raymond James & Associates raised its stake in THL Credit by 13.1% in the second quarter. Raymond James & Associates now owns 13,650 shares of the investment management company’s stock valued at $152,000 after buying an additional 1,585 shares in the last quarter. Institutional investors own 42.03% of the company’s stock.
THL Credit Company Profile
THL Credit, Inc 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, primarily through investments in privately negotiated debt and equity securities of middle market companies.
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