StoneCastle Financial Corp. (BANX) Stock Rating Reaffirmed by National Securities
StoneCastle Financial Corp. (NASDAQ:BANX)‘s stock had its “buy” rating reiterated by National Securities in a report issued on Monday. They presently have a $21.00 price objective on the investment management company’s stock. National Securities’ target price suggests a potential upside of 14.94% from the company’s current price.
The analysts wrote, “3Q16 Recap: Stone Castle Financial Corp. (BANX) reported NII/share of $0.39 for 3Q16 versus our estimate and the consensus estimate of $0.40. All-in effective yield improved 10 bps Q/Q to 12.18% and NIM (net investment margin) improved 5 bps Q/Q to 10.86%. The portfolio at fair value decreased by 8.2% Q/Q largely from only one new investment of $9.0 million versus total sales and redemptions of $26.0 million. However, we expect that activity for BANX will pick up in 4Q16. NAV/share increased to $21.29 from $21.21 the quarter prior largely from unrealized appreciation during the quarter. Debt/assets decreased significantly in light of the portfolio shrinking, down to 19.1% from 30.2% in 2Q16. The company has an upper band target of 30.0%. We expect that BANX will draw on its revolver to reach 29.9% debt/assets in 2Q17 before we model an accretive $25.0 million equity issuance in 3Q17 to deleverage the balance sheet and permit portfolio growth going forward. We are puzzled as to why BANX trades at a 12% NAV/share discount when its portfolio is marked largely using active broker quotes and on a sum of the parts basis, a lot of bank preferred stock and subordinated debt trade at premiums to par. We are maintaining our 2016 NII/share estimate of $1.57 and are revising our 2017 NII/share estimate from $1.71 to $1.70. Our $21 price target implies an estimated 2017 Price/Net Investment Income (P/ NII) of 12.4x, dividend yield of 7.0%, and Price/Net Asset Value (P/NAV) of 0.97x. “
Separately, Zacks Investment Research cut StoneCastle Financial Corp. from a “buy” rating to a “hold” rating in a research note on Tuesday, August 16th. One equities research analyst has rated the stock with a hold rating and four have assigned a buy rating to the company’s stock. The stock currently has a consensus rating of “Buy” and an average price target of $20.63.
StoneCastle Financial Corp. (NASDAQ:BANX) opened at 18.27 on Monday. The company’s 50-day moving average is $18.36 and its 200 day moving average is $18.23. StoneCastle Financial Corp. has a 12-month low of $13.81 and a 12-month high of $19.36.
A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Morgan Stanley raised its position in StoneCastle Financial Corp. by 119.0% in the third quarter. Morgan Stanley now owns 9,200 shares of the investment management company’s stock valued at $171,000 after buying an additional 5,000 shares during the period. Northern Trust Corp raised its position in StoneCastle Financial Corp. by 0.7% in the third quarter. Northern Trust Corp now owns 11,120 shares of the investment management company’s stock valued at $207,000 after buying an additional 79 shares during the period. Clear Harbor Asset Management LLC raised its position in StoneCastle Financial Corp. by 62.6% in the third quarter. Clear Harbor Asset Management LLC now owns 16,272 shares of the investment management company’s stock valued at $304,000 after buying an additional 6,263 shares during the period. Oppenheimer & Co. Inc. raised its position in StoneCastle Financial Corp. by 5.8% in the third quarter. Oppenheimer & Co. Inc. now owns 26,336 shares of the investment management company’s stock valued at $492,000 after buying an additional 1,435 shares during the period. Finally, Van Hulzen Asset Management LLC purchased a new position in StoneCastle Financial Corp. during the third quarter valued at approximately $280,000. 29.72% of the stock is currently owned by institutional investors.
StoneCastle Financial Corp. Company Profile
StoneCastle Financial Corp. is a non-diversified, closed-end management investment company. The Company’s primary investment objective is to provide stockholders with current income, and to a lesser extent capital appreciation. The Company generally invests in the senior debt, subordinated debt, preferred shares and common stock of community banks.
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