TPG Specialty Lending’s (TSLX) Buy Rating Reiterated at National Securities
National Securities reissued their buy rating on shares of TPG Specialty Lending Inc. (NYSE:TSLX) in a report published on Tuesday. The firm currently has a $19.00 price target on the stock, up from their prior price target of $18.00.
“3Q16 Recap: TPG Specialty Lending (TSLX) reported $0.51/share of NII versus consensus estimates of $0.43 and our estimate of $0.44. The earnings beat was largely attributable to higher syndication and amendment fees, with “other income” comprising 12.6% of investment income from 3.2% the quarter prior. The syndication fees were earned by TPG taking down a significantly large investment (QLIK Technologies, Inc.) and syndicating out a portion of it, enabled by the company being able to co-invest across the private funds of the external manager. Additionally, the company’s DIP (debtor-in-possession) loan to Aeropostale was repaid and resulted in $2.5 million of original issue discount (OID) acceleration, further demonstrating the strength of the company’s retail ABL (asset-based lending) vertical after a successful loan to Sports Authority this year as well. The company finished the quarter with one non-accrual, Vertellus Specialties, Inc., comprising just 0.7% of the portfolio at cost and was restructured subsequent to the end of 3Q16. We expect TSLX to continue to have strong asset quality, earnings growth, significant dividend coverage, and prudent capital management. We are adjusting our 2016 NII/share estimate from $1.71 to $1.82 and our 2017 NII/share estimate from $1.77 to $1.85. We are reiterating our BUY rating and increasing our price target to $19 from $18. Our $19 price target implies an estimated 2017 P/NII of 10.3x, dividend yield of 8.2%, and P/NAV of 1.16x compared to the BDC sector averages of 8.9x, 10.6%, and 0.84x, respectively. ,” National Securities’ analyst commented.
TSLX has been the topic of a number of other research reports. Zacks Investment Research cut shares of TPG Specialty Lending from a buy rating to a hold rating in a research note on Thursday, October 6th. TheStreet cut shares of TPG Specialty Lending from a buy rating to a hold rating in a research report on Tuesday, September 20th. Citigroup Inc. lifted their price objective on shares of TPG Specialty Lending from $16.00 to $17.00 and gave the company a neutral rating in a research report on Friday, August 12th. JPMorgan Chase & Co. lifted their price objective on shares of TPG Specialty Lending from $17.00 to $17.50 and gave the company a neutral rating in a research report on Friday, August 5th. Finally, JMP Securities upgraded shares of TPG Specialty Lending from a market perform rating to an outperform rating and set a $18.50 price objective on the stock in a research report on Friday, August 5th. Five investment analysts have rated the stock with a hold rating and six have issued a buy rating to the stock. The company currently has a consensus rating of Buy and an average price target of $18.57.
Shares of TPG Specialty Lending (NYSE:TSLX) opened at 17.98 on Tuesday. TPG Specialty Lending has a 12-month low of $15.11 and a 12-month high of $18.79. The company’s 50-day moving average is $17.88 and its 200-day moving average is $17.35.
TPG Specialty Lending (NYSE:TSLX) last released its earnings results on Monday, November 7th. The company reported $0.51 EPS for the quarter, topping analysts’ consensus estimates of $0.43 by $0.08. TPG Specialty Lending had a net margin of 53.66% and a return on equity of 11.50%. The company had revenue of $53.92 million for the quarter, compared to analysts’ expectations of $46.54 million. During the same quarter last year, the business earned $0.48 EPS. The firm’s revenue was up 15.3% compared to the same quarter last year. On average, analysts expect that TPG Specialty Lending will post $1.70 EPS for the current year.
The firm also recently announced a quarterly dividend, which will be paid on Tuesday, January 31st. Investors of record on Saturday, December 31st will be issued a $0.39 dividend. This represents a $1.56 dividend on an annualized basis and a dividend yield of 8.68%. The ex-dividend date is Wednesday, December 28th. TPG Specialty Lending’s dividend payout ratio (DPR) is presently 91.77%.
In other TPG Specialty Lending news, CFO Ian Simmonds bought 2,150 shares of the business’s stock in a transaction that occurred on Monday, August 15th. The stock was purchased at an average cost of $18.15 per share, with a total value of $39,022.50. Following the completion of the acquisition, the chief financial officer now owns 2,150 shares in the company, valued at approximately $39,022.50. The acquisition was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. 4.90% of the stock is currently owned by corporate insiders.
Several hedge funds and other institutional investors have recently bought and sold shares of the stock. Boothbay Fund Management LLC raised its position in TPG Specialty Lending by 24.3% in the first quarter. Boothbay Fund Management LLC now owns 20,783 shares of the company’s stock valued at $335,000 after buying an additional 4,066 shares during the last quarter. Delphi Financial Group Inc. raised its position in TPG Specialty Lending by 19.7% in the second quarter. Delphi Financial Group Inc. now owns 1,142,719 shares of the company’s stock valued at $18,946,000 after buying an additional 188,397 shares during the last quarter. Strs Ohio raised its position in TPG Specialty Lending by 2.5% in the second quarter. Strs Ohio now owns 4,162,136 shares of the company’s stock valued at $69,133,000 after buying an additional 101,452 shares during the last quarter. Confluence Investment Management LLC raised its position in TPG Specialty Lending by 11.9% in the second quarter. Confluence Investment Management LLC now owns 370,218 shares of the company’s stock valued at $6,149,000 after buying an additional 39,490 shares during the last quarter. Finally, Sumitomo Mitsui Asset Management Company LTD raised its position in TPG Specialty Lending by 30.9% in the second quarter. Sumitomo Mitsui Asset Management Company LTD now owns 36,123 shares of the company’s stock valued at $600,000 after buying an additional 8,523 shares during the last quarter. 59.35% of the stock is owned by hedge funds and other institutional investors.
TPG Specialty Lending Company Profile
TPG Specialty Lending, Inc (TSL) is an externally managed, closed-end, non-diversified management investment company. The Company is a specialty finance company focused on lending to middle-market companies. It seeks to generate current income primarily in the United States domiciled middle-market companies through direct originations of senior secured loans and, to a lesser extent, originations of mezzanine loans and investments in corporate bonds and equity securities.
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