Runway Growth Finance (NASDAQ:RWAY) Announces Quarterly Earnings Results

Runway Growth Finance (NASDAQ:RWAY) posted its quarterly earnings data on Thursday. The company reported $0.29 EPS for the quarter, missing the consensus estimate of $0.31 by ($0.02), Zacks reports. Runway Growth Finance had a positive return on equity of 10.57% and a negative net margin of 2.00%.The firm had revenue of $29.45 million for the quarter, compared to analysts’ expectations of $29.47 million.

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

• Closed the SWK acquisition (closed April 6), creating a pro forma portfolio of ~$1.1B, increasing healthcare to ~32% of the portfolio, reducing top‑10 concentration from 54% to 43%, and management expects the deal to be accretive to EPS (partially in Q2, fully in Q3).
• Senior leadership moves — JD Tamas hired for healthcare, Avisha Khubani promoted to Chief Credit Officer, Tom Raterman shifting to Vice Chairman, and Carmela Thomson named CFO — intended to strengthen origination, credit discipline, and financial operations.
• Q1 results showed total investment income of $29.5M and NII of $10.6M while NAV per share declined to $12.13 (down 9.6% q/q) and pro forma NAV after SWK was $11.93, reflecting about $7.7M of transaction costs and a decline in net assets to $438.2M.
• Credit deterioration in two positions — Marley Spoon and Blueshift moved to non‑accrual, lifting the weighted average risk rating to 2.67 and expected to reduce Q2 earnings by roughly $0.06 per share, though management emphasizes overall credit metrics remain stable.
• Board declared a $0.33/qtr distribution and launched a $15M share repurchase program, while liquidity stands at $372.3M with $370M borrowing capacity, though pro forma leverage rose to ~1.2 and available liquidity fell to ~$231.8M after the SWK close.

Runway Growth Finance Price Performance

Shares of RWAY stock traded down $0.29 during trading hours on Friday, reaching $6.54. The company had a trading volume of 1,622,667 shares, compared to its average volume of 703,403. The company has a debt-to-equity ratio of 0.93, a quick ratio of 1.05 and a current ratio of 1.05. The stock has a fifty day moving average of $7.00 and a 200-day moving average of $8.43. The company has a market capitalization of $277.75 million, a price-to-earnings ratio of -72.67 and a beta of 0.64. Runway Growth Finance has a 12-month low of $6.36 and a 12-month high of $11.40.

Runway Growth Finance Announces Dividend

The business also recently declared a quarterly dividend, which will be paid on Tuesday, June 2nd. Stockholders of record on Monday, May 18th will be given a $0.33 dividend. The ex-dividend date is Monday, May 18th. This represents a $1.32 dividend on an annualized basis and a dividend yield of 20.2%. Runway Growth Finance’s dividend payout ratio is 143.48%.

Institutional Inflows and Outflows

A number of large investors have recently added to or reduced their stakes in RWAY. Royal Bank of Canada lifted its holdings in Runway Growth Finance by 52.3% in the first quarter. Royal Bank of Canada now owns 21,252 shares of the company’s stock valued at $220,000 after acquiring an additional 7,299 shares during the last quarter. Invesco Ltd. lifted its holdings in Runway Growth Finance by 4.6% in the second quarter. Invesco Ltd. now owns 22,034 shares of the company’s stock valued at $236,000 after acquiring an additional 969 shares during the last quarter. Jump Financial LLC lifted its stake in Runway Growth Finance by 704.0% during the second quarter. Jump Financial LLC now owns 102,912 shares of the company’s stock worth $1,104,000 after purchasing an additional 90,112 shares in the last quarter. Raymond James Financial Inc. acquired a new position in Runway Growth Finance during the second quarter worth $51,000. Finally, Bank of America Corp DE lifted its stake in Runway Growth Finance by 32.9% during the second quarter. Bank of America Corp DE now owns 379,143 shares of the company’s stock worth $4,068,000 after purchasing an additional 93,755 shares in the last quarter. 64.61% of the stock is currently owned by institutional investors and hedge funds.

Analyst Ratings Changes

Several equities research analysts have commented on RWAY shares. Weiss Ratings reiterated a “hold (c-)” rating on shares of Runway Growth Finance in a research note on Friday, March 27th. JPMorgan Chase & Co. cut their price objective on Runway Growth Finance from $9.50 to $7.00 and set a “neutral” rating for the company in a research note on Friday, March 13th. Wells Fargo & Company cut their price objective on Runway Growth Finance from $10.00 to $7.00 and set an “equal weight” rating for the company in a research note on Monday, March 16th. Wall Street Zen upgraded Runway Growth Finance from a “sell” rating to a “hold” rating in a research note on Sunday, April 26th. Finally, Zacks Research lowered Runway Growth Finance from a “hold” rating to a “strong sell” rating in a research report on Tuesday, March 17th. Two investment analysts have rated the stock with a Buy rating, four have assigned a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat.com, Runway Growth Finance presently has an average rating of “Hold” and an average price target of $9.00.

About Runway Growth Finance

Runway Growth Finance, Inc is a publicly traded business development company that provides customized debt and equity financing solutions to high‐growth, venture‐backed companies. The firm specializes in structuring senior secured loans, unitranche facilities, second‐lien financings, convertible notes and equity co‐investments designed to extend the cash runway for late‐stage companies. Runway’s flexible capital offerings are aimed at supporting technology, life sciences and other innovation‐driven sectors as they pursue growth initiatives and prepare for liquidity events.

Originally launched in 2017 under the name Saratoga Investment Corp., the company rebranded as Runway Growth Finance in 2020 following the acquisition of an established middle‐market credit manager.