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Eagle Point Credit Company Inc (ECC)
NYSE:ECC
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Eagle Point Credit Company
(NYSE:ECC)
Rating:67Neutral
Price Target:―
Eagle Point Credit Company (ECC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
N/A
Dividend Yield22.19%
Average Volume (3M)1.03M
Price to Earnings (P/E)9.0
Beta (1Y)0.49
Revenue Growth22.24%
EPS Growth-50.71%
CountryUS
EmployeesN/A
SectorFinancial
Sector Strength78
IndustryAsset Management
Share Statistics
EPS (TTM)0.28
Shares Outstanding120,183,480
10 Day Avg. Volume875,409
30 Day Avg. Volume1,033,501
Financial Highlights & Ratios
PEG Ratio0.03
Price to Book (P/B)0.95
Price to Sales (P/S)0.00
P/FCF Ratio-6.33
Enterprise Value/Market CapN/A
Enterprise Value/Revenue0.92
Enterprise Value/Gross Profit7.30
Enterprise Value/Ebitda2.12
Forecast
1Y Price Target
$8.75Price Target Upside15.59% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
Eagle Point Credit Company Business Overview & Revenue Model
Company DescriptionEagle Point Credit Company Inc. is a closed ended fund launched and managed by Eagle Point Credit Management LLC. It invests in fixed income markets of the United States. The fund invests equity and junior debt tranches of collateralized loan obligations consisting primarily of below investment grade U.S. senior secured loans. Eagle Point Credit Company Inc. was formed on March 24, 2014 and is domiciled in the United States.
How the Company Makes MoneyEagle Point Credit Company generates revenue primarily through the income received from its investments in CLOs, including interest payments and distributions. CLOs are structured financial products backed by a pool of loans, typically to corporations with below-investment-grade credit ratings. ECC invests in the equity and junior debt tranches of these CLOs, which offer higher yield potential in exchange for greater risk. The company's earnings are significantly influenced by the performance of the underlying loan portfolios within the CLOs, as well as the broader credit market conditions. Key revenue streams include interest income, capital gains from the sale of investments, and management fees. ECC's ability to generate consistent returns is also supported by strategic partnerships with experienced CLO managers and leveraging its management team's expertise in credit analysis and investment management.
Eagle Point Credit Company Earnings Call Summary
Earnings Call Date:May 28, 2025
(Q1-2025)
| % Change Since: 0.66%|
Next Earnings Date:Aug 19, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture. On one hand, the company demonstrated strong performance in terms of net investment income, strategic portfolio rotations, and effective stock issuance. On the other hand, the call highlighted significant challenges, including a notable decline in NAV, spread compression, and a global market downturn affecting security prices. The company remains optimistic about future cash flow and investment opportunities but acknowledges current market volatility.Q1-2025 Updates
Positive Updates
Strong Start to 2025 with New Investments
Eagle Point Credit Company priced three new issue majority CLO equity investments, reset nine positions in their portfolio, and refinanced seven CLOs in the first quarter of 2025.
Net Investment Income and Realized Gains
The company generated net investment income and realized capital gains of $0.33 per share for the first quarter of 2025, consisting of $0.28 of net investment income and $0.05 of realized capital gains.
Effective Portfolio Rotation
Sales and paydowns of CLO debt in the portfolio totaled $48.5 million, and the new investments are expected to generate more net investment income in the coming quarters.
Strong Cash Flow Collection
The company collected $79.9 million of recurring cash flows or $0.69 per share, exceeding the quarterly aggregate common distributions.
Successful Stock Issuance
Issued $66 million of common stock at a premium to NAV, resulting in NAV accretion for shareholders of $0.02 per share.
Negative Updates
NAV Decline Due to Market Conditions
Net Asset Value (NAV) decreased by 13.7% from $8.38 per share at year-end to $7.23 per share as of March 31st, due to the drop in prices of nearly all CLO securities in the market.
Global Market Downturn Impact
The second part of the quarter saw a downturn in markets globally, driven by the uncertainty caused by the anticipation of tariff announcements, affecting the prices of broadly syndicated loans and CLO securities.
Spread Compression Concerns
The weighted average spread of CLO's underlying loan portfolios stood at 3.36% as of March 31st, down from 3.49% as of year-end, posing a meaningful headwind to the CLO equity market.
Higher Leverage Due to Market Conditions
Debt and preferred securities outstanding totaled approximately 41% of the company's total assets, above the target leverage range of 27.5% to 37.5%, due to the recent drop in portfolio value.
Company Guidance
During the Eagle Point Credit Company's Q1 2025 earnings call, significant financial metrics and strategic guidance were shared. The company reported net investment income and realized capital gains of $0.33 per share, comprising $0.28 of net investment income and $0.05 of realized capital gains. This was achieved through strategic trading activities, including a shift from CLO debt to CLO equity. However, the NAV decreased by 13.7% from $8.38 at year-end 2024 to $7.23, reflecting a downturn in CLO securities prices due to market volatility. Eagle Point generated $79.9 million in recurring cash flows, exceeding its quarterly common distributions, with new CLO equity investments yielding an average effective yield of 18.9%. The company maintains a fixed-rate financing strategy, with no maturities before 2028, and issued $66 million of common stock and $22 million of 7% preferred stock, bolstering its capital position. Despite recent market challenges, Eagle Point remains focused on leveraging its advantageous CLO portfolio positioning, with plans for continued portfolio rotation and strategic reinvestments.Eagle Point Credit Company Financial Statement Overview
Summary
Eagle Point Credit Company demonstrates strong profitability and financial stability with a robust equity position and no debt. However, challenges in revenue growth and cash flow management could pose risks. While the company shows resilience in maintaining profitability, addressing cash flow inefficiencies will be crucial for sustained growth and operational efficiency.Income Statement
Eagle Point Credit Company has shown significant improvement in its income statement over the years. The company's gross profit margin in the latest year is 100%, and the net profit margin is approximately 87.6%, indicating strong profitability. However, the revenue has decreased year-over-year compared to 2023, which was higher. The EBIT and EBITDA margins are not calculable for the latest year, which poses a challenge in assessing operational efficiency comprehensively.68
Positive
Balance Sheet
The balance sheet reflects a solid equity base with a high equity ratio of about 62.2%, indicating financial stability. The company has no debt, which reduces financial risk. However, the return on equity has decreased due to lower net income, presenting a potential area of concern for investors seeking high returns.75
Positive
Cash Flow
The cash flow statement shows challenges with negative operating cash flow, which could indicate operational inefficiencies. The free cash flow is also negative, signaling potential cash flow issues. Despite these, the company has managed to increase its financing cash flow significantly, which may support future liquidity needs.60
Neutral
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 97.61M | 139.07M | -92.73M | 140.84M | 64.06M |
| Gross Profit | 97.61M | 139.07M | -119.87M | 119.66M | 49.04M |
| EBITDA | 103.83M | 132.38M | -87.68M | 0.00 | 0.00 |
| Net Income | 85.49M | 116.89M | -101.81M | 131.86M | 60.89M |
Balance Sheet | |||||
| Total Assets | 1.51B | 954.49M | 760.15M | 768.04M | 512.59M |
| Cash, Cash Equivalents and Short-Term Investments | 42.22M | 46.45M | 56.83M | 13.92M | 4.76M |
| Total Debt | 0.00 | 157.71M | 150.77M | 140.69M | 92.80M |
| Total Liabilities | 568.58M | 218.72M | 260.89M | 241.85M | 150.93M |
| Stockholders Equity | 936.87M | 735.78M | 499.27M | 526.19M | 361.66M |
Cash Flow | |||||
| Free Cash Flow | -429.00M | -81.57M | -74.97M | -114.71M | 1.22M |
| Operating Cash Flow | -429.00M | -81.57M | -74.97M | -114.71M | 1.22M |
| Investing Cash Flow | 0.00 | 0.00 | -132.01M | -157.48M | 22.72K |
| Financing Cash Flow | 424.38M | 71.33M | 117.87M | 123.94M | -29.46M |
Eagle Point Credit Company Technical Analysis
Neutral
7.57
Price Trends
7.55
Positive
7.66
Negative
7.96
Negative
Market Momentum
-0.01
Positive
50.12
Neutral
54.93
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ECC, the sentiment is Neutral. The current price of 7.57 is below the 20-day moving average (MA) of 7.61, above the 50-day MA of 7.55, and below the 200-day MA of 7.96, indicating a neutral trend. The MACD of -0.01 indicates Positive momentum. The RSI at 50.12 is Neutral, neither overbought nor oversold. The STOCH value of 54.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ECC.
Eagle Point Credit Company Peers Comparison
Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $230.49M | 11.68 | 8.67% | 13.46% | ― | ― | |
73 Outperform | $599.56M | 23.76 | 7.67% | 6.33% | ― | ― | |
67 Neutral | $16.67B | 11.44 | 9.71% | 3.91% | 11.61% | -9.60% | |
67 Neutral | 9.03 | -5.67% | 22.19% | 22.24% | -50.71% | ||
56 Neutral | $297.93M | 5.93 | 18.18% | 6.72% | 21.99% | 23.40% | |
48 Neutral | $124.33M | 26.09 | 3.56% | 13.74% | 32.38% | -90.38% | |
45 Neutral | $191.71M | ― | -9.96% | ― | 90.08% | -893.47% |
* Financial Sector Average
Performance Comparison
ECC
Eagle Point Credit Company
7.57
-0.66
-8.02%
NEWT
Newtek Business
11.31
-0.43
-3.66%
SSSS
SuRo Capital
8.14
4.19
106.08%
GECC
Great Elm Capital
10.77
1.79
19.93%
VINP
Vinci Partners Investments
9.48
-0.76
-7.42%
LIEN
Chicago Atlantic BDC
10.10
-0.27
-2.60%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.