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Tcg Bdc (CGBD)
:CGBD
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TCG BDC
(NASDAQ:CGBD)
68Neutral
Positive Factors
Stock Performance
CGBD shares have outperformed peers since the Q3 print, are trading near its 52-week high.
Negative Factors
Earnings
Analyst downgrades CGBD from Buy to Underperform due to expected disappointment in core earnings growth and profitability following its merger with an affiliated private BDC.
Financial Performance
CGBD reported NOI of $0.47, below analyst's $0.52 estimate and the $0.49 consensus.
Investor Behavior
Technical pressures are anticipated as new CGBD shareholders rebalance their portfolios, impacting the shares negatively.
Market Valuation
CGBD shares are trading at a roughly 10% premium compared to external peers, which analysts believe is not justified.
TCG BDC (CGBD) vs. S&P 500 (SPY)
Market Cap
$852.00M
Dividend Yield11.18%
Average Volume (3M)197.32K
Price to Earnings (P/E)10.6
Beta (1Y)0.60
Revenue Growth-11.85%
EPS Growth-3.73%
CountryUS
EmployeesN/A
SectorFinancial
Sector Strength82
IndustryAsset Management
Share Statistics
EPS (TTM)1.58
Shares Outstanding50,956,966
10 Day Avg. Volume214,590
30 Day Avg. Volume197,323
Financial Highlights & Ratios
PEG Ratio0.33
Price to Book (P/B)N/A
Price to Sales (P/S)5.15
Price to Cash Flow (P/CF)-2.00
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$17.00Price Target Upside1.67% Upside
Rating ConsensusModerate Sell
Number of Analyst Covering3
TCG BDC Business Overview & Revenue Model
Company DescriptionTCG BDC, Inc. is business development company specializing in first lien debt, senior secured loans, second lien senior secured loan unsecured debt, mezzanine debt and investments in equities. It specializes in directly investing. It specializes in middle market. It targets healthcare and pharmaceutical, aerospace and defense, high tech industries, business services, software, beverage food and tobacco, hotel gamming and leisure, banking finance insurance and in real estate sector. The fund seeks to invest across United States of America, Luxembourg, Cayman Islands, Cyprus, and United Kingdom. It invests in companies with EBITDA between $25 million and $100 million.
How the Company Makes MoneyTCG BDC generates revenue primarily through interest income and capital gains from its investment portfolio. The company makes money by charging interest on its loans to middle-market companies, which forms the core of its revenue stream. Additionally, it earns income from dividends on equity investments and may realize gains from the sale of investments. TCG BDC's earnings are significantly influenced by its ability to source high-quality debt investments with favorable terms. The company may also engage in strategic partnerships to enhance its investment opportunities and expand its portfolio.
TCG BDC Financial Statement Overview
Summary
TCG BDC demonstrates efficient management of operations with strong EBIT margins and a solid equity position. However, the recent drop in revenue and net income highlight areas of potential concern. The company’s cash flow remains strong, but monitoring the cash generation trends will be critical moving forward.Income Statement
The company has shown a fluctuating revenue trend with a revenue decline in the most recent year. Despite this, the company maintains a strong gross profit margin and EBIT margin, indicating efficient cost management. The absence of net income in the latest year is a concern.65
Positive
Balance Sheet
The company has a solid equity base with a satisfactory debt-to-equity ratio, indicating lower leverage and potential for financial stability. The equity ratio suggests a balanced asset structure. However, the reduction in total assets over the years could be a risk if not managed well.70
Positive
Cash Flow
Cash flow from operations shows strength with a substantial free cash flow, although it has decreased from the previous year. The free cash flow to net income ratio is positive, but the operating cash flow to net income ratio is unavailable due to net income being zero in the latest year.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 232.59M | 241.63M | 162.16M | 169.89M | 17.12M | Gross Profit |
| 232.59M | 207.47M | 110.31M | 122.53M | -30.77M | EBIT |
| 225.63M | 184.12M | 131.43M | 161.13M | 7.40M | EBITDA |
| 0.00 | 169.96M | 149.83M | 161.13M | 50.83M | Net Income Common Stockholders |
| 88.98M | 92.28M | 85.64M | 160.35M | 6.83M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 56.58M | 60.45M | 930.75M | 93.07M | 68.42M | Total Assets |
| 1.93B | 1.94B | 2.04B | 2.03B | 1.92B | Total Debt |
| 0.00 | 980.18M | 1.08B | 1.04B | 983.92M | Net Debt |
| -56.58M | 919.74M | 1.06B | 950.95M | 915.50M | Total Liabilities |
| 1.02B | 1.03B | 1.12B | 1.08B | 1.02B | Stockholders Equity |
| 905.20M | 912.81M | 917.42M | 948.80M | 901.36M |
| Cash Flow | Free Cash Flow | |||
| 104.27M | 230.61M | 14.51M | 75.43M | 305.16M | Operating Cash Flow |
| 104.27M | 230.61M | 14.51M | 75.43M | 305.16M | Investing Cash Flow |
| 0.00 | 0.00 | -56.96M | 6.06M | 236.87M | Financing Cash Flow |
| -108.14M | -200.67M | -77.08M | -50.78M | -273.49M |
TCG BDC Technical Analysis
Negative
16.72
Price Trends
17.22
Negative
16.89
Negative
16.49
Positive
Market Momentum
-0.11
Negative
47.70
Neutral
41.09
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CGBD, the sentiment is Negative. The current price of 16.72 is above the 20-day moving average (MA) of 16.64, below the 50-day MA of 17.22, and above the 200-day MA of 16.49, indicating a neutral trend. The MACD of -0.11 indicates Negative momentum. The RSI at 47.70 is Neutral, neither overbought nor oversold. The STOCH value of 41.09 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CGBD.
TCG BDC Risk Analysis
TCG BDC disclosed 71 risk factors in its most recent earnings report. TCG BDC reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
TCG BDC Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $15.13B | 9.06 | 12.40% | 8.68% | 19.95% | -10.57% | |
74 Outperform | $5.02B | 9.68 | 19.26% | 5.24% | 51.80% | 12.05% | |
68 Neutral | $852.00M | 10.61 | 9.77% | 11.18% | -11.85% | -3.73% | |
67 Neutral | $3.33B | 11.96 | 13.71% | 8.31% | -1.49% | -29.48% | |
64 Neutral | $14.25B | 10.26 | 8.97% | 4.33% | 16.33% | -11.91% | |
63 Neutral | $714.08M | 8.56 | 12.58% | 8.37% | 2.31% | -15.06% | |
60 Neutral | $284.57M | 8.65 | 9.26% | 19.75% | 22.53% | ― |
* Financial Sector Average
Performance Comparison
CGBD
TCG BDC
16.72
2.22
15.31%
FDUS
Fidus Investment
20.39
2.89
16.51%
HTGC
Hercules Capital
19.26
2.74
16.59%
MAIN
Main Street Capital
56.66
13.30
30.67%
ARCC
Ares Capital
22.11
3.49
18.74%
TPVG
TriplePoint Venture Growth
7.09
-0.84
-10.59%
TCG BDC Earnings Call Summary
Earnings Call Date: Feb 25, 2025 | % Change Since: -1.99% | Next Earnings Date: May 13, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong credit performance, strategic mergers, and portfolio growth while facing minor challenges in NAV decline and specific non-accruals. The strategic steps taken appear to position the company well for future growth.Highlights
Stable Credit Performance and High Yield
Carlyle Secured Lending, Inc. generated net investment income of $0.47 per share, representing an annualized yield of over 11% based on the December 31 NAV. The board declared a total fourth quarter dividend of $0.45 per share.
Record Deployment and Portfolio Growth
Achieved record highs for deployment in both the fourth quarter and the full year of 2024, growing its portfolio by about $100 million in the quarter.
Strategic Affiliate Merger
Proposed a merger with Carlyle Secured Lending 3, expected to deliver increased scale and liquidity, eliminate preferred stock dilution, and reduce costs.
Investment Grade Ratings
Obtained investment grade ratings from both Fitch and Moody's, allowing for the issuance of the first-ever institutional bond deal.
Portfolio Diversification
As of December 31, the portfolio comprised 189 investments across more than 25 industries, with 93% in senior secured loans.
Joint Venture Optimization
Consolidated MMCF 2 onto the balance sheet and extended MMCF 1's investment period, enhancing the earnings profile.
Lowlights
Net Asset Value Slight Decline
The net asset value as of December 31 was $16.80 per share, compared to $16.85 per share as of September 30.
Unrealized Losses and Non-Accruals
Total aggregate realized and unrealized net loss was about $4 million for the quarter, with Aimbridge markdowns and ongoing non-accruals.
JEGS Automotive Restructuring
Completed the restructuring of JEGS Automotive, which remained on non-accrual status as of December 31.
Incremental Dividend Impact
An incremental dividend from JV 2 resulted in an adjusted net investment income per share that was two cents lower than the prior quarter.
Company Guidance
During the fourth quarter of 2024, Carlyle Secured Lending, Inc. reported a net investment income of $0.47 per share, reflecting an annualized yield of over 11% based on the December 31 net asset value (NAV) of $16.80 per share, slightly down from $16.85 at the end of the previous quarter. The company declared a total dividend of $0.45 per share, which includes a base dividend of $0.40 and a supplemental dividend of $0.05. The portfolio saw significant growth, increasing by about $100 million, with a close rate of approximately 5% on new deals, and 94% of 2024 originations in first lien investments. Carlyle also announced a strategic merger with Carlyle Secured Lending 3, anticipated to close by March 31, 2025, aiming to enhance scale, liquidity, and reduce costs. The company's portfolio consisted of 189 investments across 135 companies, with 93% in senior secured loans, and a median EBITDA of $88 million. For the fourth quarter, total investment income was $56 million, and total expenses remained flat at $31 million. Carlyle secured investment-grade ratings from Fitch and Moody’s, issuing a $300 million institutional bond with a 6.75% fixed rate, and maintained a statutory leverage of about 1.2 times.TCG BDC Corporate Events
M&A TransactionsShareholder Meetings
TCG BDC Completes Acquisition of Carlyle Secured Lending III
Positive
Mar 28, 2025
On March 27, 2025, Carlyle Secured Lending, Inc. (CGBD) completed its acquisition of Carlyle Secured Lending III (CSL III), following a merger agreement initially announced in August 2024. This merger resulted in CGBD issuing approximately 18,935,108 shares of common stock to former CSL III shareholders. The merger was approved by 96% of voting shareholders at a special meeting held on March 26, 2025. The transaction aims to create long-term value through increased portfolio scale and efficiency, with a closing price per share of CGBD’s common stock on the Nasdaq Global Select Market being less than 11% greater than its net asset value per share as of March 25, 2025.
DividendsFinancial Disclosures
TCG BDC Announces Strong 2024 Financial Results
Positive
Feb 25, 2025
Carlyle Secured Lending, Inc. announced its financial results for the fourth quarter and full year ending December 31, 2024, highlighting a strong finish with portfolio growth and net investment income above the base dividend. The company declared a first quarter 2025 dividend of $0.45 per share, including a supplemental dividend, payable on April 17, 2025. The announcement reflects CGBD’s robust performance despite market challenges, positioning it well for continued success in 2025.
Financial Disclosures
TCG BDC Schedules Conference Call for Financial Results
Neutral
Jan 14, 2025
Carlyle Secured Lending, Inc. announced that it will host a conference call on February 26, 2025, to discuss its financial results for the fourth quarter and full year ending December 31, 2024. The announcement is significant as it provides stakeholders with an opportunity to gain insights into the company’s financial performance, potentially impacting their investment decisions and the company’s positioning in the market.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.