National Securities Reiterates Buy Rating for TCP Capital Corp. (TCPC)
National Securities reaffirmed their buy rating on shares of TCP Capital Corp. (NASDAQ:TCPC) in a research report sent to investors on Thursday morning. They currently have a $19.00 price objective on the investment management company’s stock.
“• For 3Q17, TCPC posted NII/share of $0.38, two cents above the dividend and a penny above our own estimate. While the earnings are certainly down Q/Q, we note that 2Q17 was a noisy quarter with a significant amount of prepayment-related income.
• NAV declined Q/Q to $14.92 from $15.04 as unrealized losses and realized losses both increased but were offset partially by NII exceeding the dividend. The company had two non-accruals on the quarter, both of which were marked at zero and thus any realized loss on these in the future would reverse prior unrealized depreciation.
• TCP originated $242.6 million of loans on the quarter, down slightly from the landmark 2Q17 number of $263.4 million. We believe that TCP is genuinely seeing good opportunities in its pipeline, as the company has had no qualms in the past about letting the portfolio shrink. We regard TCP as a credit investor, not asset gatherer, and as such we think that the strong portfolio growth will contribute positively to economic returns for shareholders.
• We are revising our 2017 NII/share estimate to $1.60 from $1.58 and are revising our 2018 NII/share estimate to $1.59 from $1.60.,” the firm’s analyst wrote.
TCPC has been the subject of several other research reports. National Bank Financial raised TCP Capital Corp. from a sector perform rating to an outperform rating in a research report on Monday, August 7th. BidaskClub cut TCP Capital Corp. from a hold rating to a sell rating in a research report on Sunday, July 16th. Zacks Investment Research raised TCP Capital Corp. from a sell rating to a hold rating in a research report on Thursday, July 13th. Finally, Keefe, Bruyette & Woods reaffirmed a buy rating and issued a $18.00 target price on shares of TCP Capital Corp. in a research report on Tuesday, July 25th. One research analyst has rated the stock with a sell rating, one has assigned a hold rating and four have issued a buy rating to the stock. The company presently has a consensus rating of Buy and a consensus price target of $18.25.
Shares of TCP Capital Corp. (NASDAQ TCPC) traded down $0.02 during trading on Thursday, hitting $15.90. The stock had a trading volume of 162,200 shares, compared to its average volume of 184,060. The firm has a market capitalization of $931.86, a PE ratio of 9.19, a PEG ratio of 2.04 and a beta of 0.73. The company has a current ratio of 1.18, a quick ratio of 1.18 and a debt-to-equity ratio of 0.76. TCP Capital Corp. has a 1-year low of $15.55 and a 1-year high of $17.47.
The firm also recently announced a quarterly dividend, which will be paid on Friday, December 29th. Stockholders of record on Friday, December 15th will be given a $0.36 dividend. The ex-dividend date of this dividend is Thursday, December 14th. This represents a $1.44 annualized dividend and a dividend yield of 9.06%. TCP Capital Corp.’s dividend payout ratio (DPR) is presently 105.11%.
TCP Capital Corp. announced that its board has initiated a share repurchase plan on Tuesday, November 7th that permits the company to buyback $50.00 million in shares. This buyback authorization permits the investment management company to reacquire shares of its stock through open market purchases. Shares buyback plans are typically an indication that the company’s management believes its shares are undervalued.
Institutional investors and hedge funds have recently added to or reduced their stakes in the stock. Sheaff Brock Investment Advisors LLC acquired a new stake in TCP Capital Corp. during the second quarter valued at $182,000. HighTower Advisors LLC acquired a new stake in TCP Capital Corp. during the second quarter valued at $189,000. Global X MANAGEMENT CO LLC boosted its position in TCP Capital Corp. by 51.4% during the third quarter. Global X MANAGEMENT CO LLC now owns 11,472 shares of the investment management company’s stock valued at $189,000 after purchasing an additional 3,894 shares during the last quarter. Trexquant Investment LP acquired a new stake in TCP Capital Corp. during the third quarter valued at $190,000. Finally, RFG Advisory Group LLC acquired a new stake in TCP Capital Corp. during the second quarter valued at $206,000. 53.06% of the stock is owned by hedge funds and other institutional investors.
About TCP Capital Corp.
TCP Capital Corp. is an externally managed, closed-end, non-diversified management investment company. The Company’s investment objective is to achieve high total returns through current income and capital appreciation, with an emphasis on principal protection. It invests in the debt of middle-market companies, as well as small businesses, including senior secured loans, junior loans, mezzanine debt and bonds.
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