WhiteHorse Finance (NASDAQ:WHF) Announces Earnings Results, Misses Estimates By $0.03 EPS

WhiteHorse Finance (NASDAQ:WHF) announced its quarterly earnings data on Monday. The investment management company reported $0.22 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.25 by ($0.03), Zacks reports. The business had revenue of $14.83 million for the quarter, compared to analysts’ expectations of $15.19 million. WhiteHorse Finance had a net margin of 39.44% and a return on equity of 8.53%.

Here are the key takeaways from WhiteHorse Finance’s conference call:

• NAV rose for a second consecutive quarter to $11.82 per share, supported by unrealized gains in Chase Products and PlayMonster. Non-accruals fell to 2% of the debt portfolio’s fair value after Outward Hound returned to accrual status.
• WhiteHorse is pursuing a sale of Chase Products, which it expects could close within two to four months, and said PlayMonster’s stronger performance could lead to a sale process in the first half of 2027. Both equity positions generate limited current income, but a realization could provide capital for income-producing investments.
• Core NII was $0.224 per share and GAAP NII was $0.207, both below the $0.25 quarterly base distribution; GAAP results included about $450,000 of non-recurring expenses. The advisor extended its reduced incentive fee rate through Q4, while management said future distributions will be evaluated against the portfolio’s core earnings power.
• The company has $85 million of unsecured notes maturing in December and is discussing financing options, but has not provided details. Management expressed confidence it can address the maturities, while noting replacement fixed-rate funding could cost roughly 7%–8%, well above the maturing notes’ 4% and 5.375% coupons.
• An independent-director committee is reviewing strategic alternatives, potentially including a sale or other corporate transaction, but has set no timetable and there is no assurance of a deal. WhiteHorse has paused share repurchases while the review proceeds, but says it will continue selective portfolio investment.

WhiteHorse Finance Trading Down 0.6%

Shares of WHF opened at $8.05 on Wednesday. WhiteHorse Finance has a 12-month low of $6.07 and a 12-month high of $8.53. The firm has a market capitalization of $172.91 million, a P/E ratio of 8.18 and a beta of 0.37. The firm has a 50-day moving average price of $7.44 and a 200 day moving average price of $7.05. The company has a current ratio of 1.39, a quick ratio of 1.39 and a debt-to-equity ratio of 1.29.

WhiteHorse Finance Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Wednesday, January 6th. Investors of record on Monday, December 21st will be issued a $0.25 dividend. The ex-dividend date of this dividend is Monday, December 21st. This represents a $1.00 dividend on an annualized basis and a dividend yield of 12.4%. WhiteHorse Finance’s dividend payout ratio is currently 126.58%.

Analysts Set New Price Targets

A number of research analysts have weighed in on the stock. Raymond James Financial raised shares of WhiteHorse Finance from a “market perform” rating to an “outperform” rating and set a $9.00 target price on the stock in a research note on Thursday, October 22nd. JPMorgan Chase & Co. upped their price target on WhiteHorse Finance from $6.50 to $7.50 and gave the company an “underweight” rating in a research report on Tuesday. B. Riley Financial raised WhiteHorse Finance from a “neutral” rating to a “buy” rating and increased their price target for the company from $8.00 to $9.00 in a report on Tuesday. Finally, Weiss Ratings upgraded WhiteHorse Finance from a “sell (d+)” rating to a “hold (c-)” rating in a research report on Monday, November 2nd. Two equities research analysts have rated the stock with a Buy rating, two have issued a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat.com, the stock currently has a consensus rating of “Hold” and a consensus target price of $8.50.

About WhiteHorse Finance

WhiteHorse Finance, Inc. is a business development company that provides financing to privately owned, middle-market businesses in the United States. The company primarily invests in senior secured loans, including first-lien and unitranche loans, and may also provide second-lien and subordinated debt financing. In addition to debt investments, WhiteHorse Finance may make equity investments and co-investments alongside its lending activities. Its portfolio generally supports acquisitions, recapitalizations, refinancings, growth initiatives and other corporate purposes for middle-market companies across a range of industries.