TCP Capital Corp. (NASDAQ:TCPC)‘s stock had its “buy” rating reiterated by National Securities in a research report issued to clients and investors on Thursday. They currently have a $17.00 price target on the investment management company’s stock. National Securities’ price objective indicates a potential upside of 3.85% from the stock’s current price.
The analysts wrote, “$140 Million Convertible Notes Offering: TCPC (TCP Capital Corp.) issued $140 million (including overallotment) of 4.625% convertible notes due March 2022. The notes do not automatically convert above NAV as the ones sold to CNO financial this year did. Rather, the notes initially convert at 54.5019 shares per $1,000 of par (or $18.35/share). This represents a 25% premium to the 6/30/16 NAV/share. We expect that TCPC will pay down its operating company facility entirely and will pay down $70.0 million of its funding facility. These actions, combined with the $35.3 million of equity sold in a private placement plus our expectations of further SBA (Small Business Administration) debentures issuance will permit portfolio growth to continue through the remainder of 2016 with regulatory D/E (excluding SBA debentures) estimated to finish the year at 0.64x. The all-in cost of funds will likely increase to 3.81% for 2016 and 3.91% in 2017 from 3.36% in 2015. Floating rate funding for TCPC would fall to 42.7% in 4Q16 and 45.9% in 4Q17 from 70.4% in 4Q15 under our assumptions. We continue to expect robust portfolio growth through the next six quarters. We are revising our 2016 NII/share estimate from $1.55 to $1.53 and our 2017 NII/share estimate from $1.71 to $1.69. Our $17 price target implies an estimated 2017 P/NII (Price/NII) of 10.1x, dividend yield of 8.5%, and P/NAV (Price/NAV) of 1.11x compared to the BDC sector averages of 9.1x, 10.4%, and 0.90x, respectively. “
A number of other research firms also recently commented on TCPC. Deutsche Bank AG raised their price objective on shares of TCP Capital Corp. from $14.75 to $15.50 and gave the stock a “hold” rating in a report on Wednesday, August 10th. JMP Securities raised their price objective on shares of TCP Capital Corp. from $16.50 to $17.00 and gave the stock a “market outperform” rating in a report on Wednesday, August 10th. Zacks Investment Research raised shares of TCP Capital Corp. from a “sell” rating to a “hold” rating in a report on Thursday, August 11th. FBR & Co raised their price objective on shares of TCP Capital Corp. from $16.00 to $17.50 and gave the stock an “outperform” rating in a report on Wednesday, August 10th. Finally, Citigroup Inc. raised their price objective on shares of TCP Capital Corp. from $14.00 to $15.00 and gave the stock a “neutral” rating in a report on Wednesday, August 17th. Four investment analysts have rated the stock with a hold rating and seven have issued a buy rating to the stock. The stock currently has a consensus rating of “Buy” and an average target price of $16.40.
TCP Capital Corp. (NASDAQ:TCPC) opened at 16.37 on Thursday. TCP Capital Corp. has a 12-month low of $12.00 and a 12-month high of $16.78. The stock has a 50 day moving average of $16.23 and a 200 day moving average of $15.22.
TCP Capital Corp. (NASDAQ:TCPC) last released its quarterly earnings data on Tuesday, August 9th. The investment management company reported $0.38 EPS for the quarter, missing analysts’ consensus estimates of $0.39 by $0.01. TCP Capital Corp. had a return on equity of 12.52% and a net margin of 39.12%. On average, analysts expect that TCP Capital Corp. will post $1.51 EPS for the current fiscal year.
The business also recently announced a quarterly dividend, which will be paid on Friday, September 30th. Shareholders of record on Friday, September 16th will be paid a $0.36 dividend. This represents a $1.44 dividend on an annualized basis and a dividend yield of 8.80%. The ex-dividend date is Wednesday, September 14th. TCP Capital Corp.’s dividend payout ratio is presently 134.58%.
Several institutional investors have recently made changes to their positions in TCPC. Ngam Advisors L.P. increased its position in shares of TCP Capital Corp. by 4.0% in the first quarter. Ngam Advisors L.P. now owns 275,884 shares of the investment management company’s stock worth $4,113,000 after buying an additional 10,614 shares in the last quarter. Mckinley Capital Management LLC Delaware increased its position in shares of TCP Capital Corp. by 25.0% in the first quarter. Mckinley Capital Management LLC Delaware now owns 161,149 shares of the investment management company’s stock worth $2,403,000 after buying an additional 32,251 shares in the last quarter. BlackRock Group LTD increased its position in shares of TCP Capital Corp. by 6.8% in the first quarter. BlackRock Group LTD now owns 228,815 shares of the investment management company’s stock worth $3,412,000 after buying an additional 14,607 shares in the last quarter. UBS Group AG increased its position in shares of TCP Capital Corp. by 9.0% in the first quarter. UBS Group AG now owns 880,194 shares of the investment management company’s stock worth $13,124,000 after buying an additional 72,461 shares in the last quarter. Finally, Sigma Planning Corp bought a new position in shares of TCP Capital Corp. during the second quarter worth $229,000. 44.33% of the stock is owned by institutional investors.
About TCP Capital Corp.
TCP Capital Corp. is a 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. The Company invests in debt securities of middle-market companies.
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