SLR Investment Corp. (SLRC – Research Report), the Financial sector company, was revisited by a Wall Street analyst yesterday. Analyst Finian O’Shea from Wells Fargo maintained a Sell rating on the stock and has a $12.00 price target.
Protect Your Portfolio Against Market Uncertainty
- Discover companies with rock-solid fundamentals in TipRanks' Smart Value Newsletter.
- Receive undervalued stocks, resilient to market uncertainty, delivered straight to your inbox.
Finian O’Shea has given his Sell rating due to a combination of factors impacting SLR Investment Corp. The company’s net operating income (NOI) has shown a decline, with the most recent figure at $0.41, down from $0.44 in the previous quarter. Although this aligns with expectations and the declared dividend, the overall financial performance is under pressure. Additionally, while dividends from controlled companies have increased, some of these gains are considered one-time events, and the sustainability of such growth is uncertain.
Another concern is the write-down of SLR Equipment Finance by approximately $6 million, which has contributed to net losses in recent quarters. The joint venture’s lower assets and spread compression are expected to lead to reduced dividends, further affecting the company’s financial health. Moreover, the company’s exposure to higher fixed-rate and absolute return investments may not yield the anticipated returns in a declining SOFR environment. These factors, combined with high general and administrative expenses, have led to a cautious outlook, reflected in the unchanged price target of $12 and an Underweight rating.
According to TipRanks, O’Shea is a 4-star analyst with an average return of 6.3% and a 56.50% success rate. O’Shea covers the Financial sector, focusing on stocks such as Barings BDC, BlackRock TCP Capital, and TriplePoint Venture Growth.