MidCap Financial Investment Corporation (MFIC) AI Stock Analysis

• Market Cap: N/A
• Dividend Yield: 13.2%
• Average Volume (3M): 350.92K
• Price to Earnings (P/E): 12.2
• Beta (1Y): 0.60
• Revenue Growth: 0.47%
• EPS Growth: -36.87%
• Country: US
• Employees: N/A
• Sector: Financial
• Sector Strength: 77
• Industry: Asset Management
• EPS (TTM): 0.39
• Shares Outstanding: 93,303,620
• 10 Day Avg. Volume: 310,899
• 30 Day Avg. Volume: 350,918
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: 14.80
• Enterprise Value/Gross Profit: 22.34
• Enterprise Value/Ebitda: 29.41
• 1Y Price Target: $13.75
• Price Target Upside: 5.53% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

• Rating: 69 Neutral
• Price Target: ―

MidCap Financial Investment Corporation's stock score is driven by its strong profitability and balance sheet, coupled with attractive valuation metrics such as a low P/E ratio and high dividend yield. However, the company faces challenges with declining revenue and cash flow, as well as below-target leverage and spread compression noted in the earnings call. Technical indicators suggest stability but indicate cautious optimism.

Positive Factors

Financial Performance

MFIC reported NOI of $0.44, above the $0.41 estimate, largely due to lower incentive fees.

Valuation

Merx' valuation improved as it paid down its revolver by $7.5 million.

Negative Factors

Credit Loss

Credit loss appeared to stem from Surf OpCo, which is now marked in the 80s of cost.

Risk Management

Elevated leverage with CLO financing may add risk to the story.

MidCap Financial Investment Corporation Business Overview & Revenue Model

Company Description

Apollo Investment Corporation is business development company and a closed-end, externally managed, non-diversified management investment company. It is elected to be treated as a business development company (BDC) under the Investment Company Act of 1940 (the 1940 Act) specializing in private equity investments in leveraged buyouts, acquisitions, recapitalizations, growth capital, refinancing and private middle market companies. It provides direct equity capital, mezzanine, first lien secured loans, stretch senior loans, unitranche loans, second lien secured loans and senior secured loans, unsecured debt, and subordinated debt and loans. It also seeks to invest in PIPES transactions. The fund may also invest in securities of public companies that are thinly traded and may acquire investments in the secondary market and structured products. It prefers to invest in preferred equity, common equity / interests and warrants and makes equity co-investments. It may invest in cash equivalents, U.S. government securities, high-quality debt investments that mature in one year or less, high-yield bonds, distressed debt, non-U.S. investments, or securities of public companies that are not thinly traded. It also focuses on other investments such as collateralized loan obligations (CLOs) and credit-linked notes (CLNs). The fund typically invests in construction and building materials, business services, plastics & rubber, advertising, capital equipment, education, cable television, chemicals, consumer products/goods durable and non-durable and customer services, direct marketing, energy – oil & gas, electricity and utilities. The fund also invest in aerospace & defense, wholesale, telecommunications, financial services, hotel, gaming, leisure, restaurants; environmental industries, healthcare and pharmaceuticals, high tech industries, beverages, food and tobacco, manufacturing, media – diversified & production, printing and publishing, retail, automation, aviation and consumer transport, transportation, cargo and distribution. It primarily invests in United States. It primarily invests between $20 million and $250 million in its portfolio companies. The fund seeks to make investments with stated maturities of five to 10 years.

How the Company Makes Money

MidCap Financial Investment Corporation makes money by providing loans and other credit solutions to middle-market companies. The primary revenue stream comes from the interest income generated on these loans. Additionally, MFIC may earn fees associated with the origination, structuring, and management of these loans. The company's earnings are influenced by factors such as interest rate fluctuations, credit risk management, and strategic partnerships with other financial institutions that may co-invest in loan opportunities.

MidCap Financial Investment Corporation Financial Statement Overview

Summary

MidCap Financial Investment Corporation presents a mixed financial profile. The income statement reflects robust profitability but declining revenue. The balance sheet is strong with zero debt, yet this could limit expansion. Cash flow challenges are evident with a steep drop in free cash flow. While the company maintains profitability, addressing revenue declines and improving cash flow are crucial for future growth.

Income Statement

MidCap Financial Investment Corporation shows a positive net profit margin of 89.07% in the TTM, reflecting strong profitability. However, the revenue growth rate is negative at -8.91% from the previous year, indicating a decline in revenue. The EBIT margin stands at 69.91%, showcasing efficient operations. Overall, the company demonstrates solid profitability but faces challenges with revenue growth.

Balance Sheet

The company has a strong equity base with zero total debt in the TTM, resulting in a debt-to-equity ratio of 0. The return on equity is high at 7.63%, indicating effective use of equity to generate profits. The equity ratio is 44.04%, suggesting a balanced asset financing structure. While the lack of debt offers stability, it may limit growth opportunities.

Cash Flow

MFIC's free cash flow growth rate is negative at -92.81% in the TTM, indicating a significant decline in free cash flow. The operating cash flow to net income ratio is 0.13, suggesting that cash generation is lagging behind income. These metrics highlight potential liquidity challenges despite positive net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	213.38M	226.31M	133.15M	141.46M	96.72M	126.73M
Gross Profit	141.32M	110.35M	276.50K	94.06M	96.72M	85.92M
EBITDA	107.36M	98.82M	266.40K	103.47M	137.38M	111.86M
Net Income	99.22M	98.82M	118.76M	30.59M	82.36M	111.86M
Balance Sheet
Total Assets	3.46B	3.19B	2.50B	2.53B	2.60B	2.54B
Cash, Cash Equivalents and Short-Term Investments	68.98M	75.79M	122.13M	87.09M	30.60M	54.62M
Total Debt	0.00	1.75B	1.46B	1.48B	1.55B	1.47B
Total Liabilities	2.09B	1.79B	1.50B	1.54B	1.60B	1.51B
Stockholders Equity	1.38B	1.40B	1.01B	988.11M	1.00B	1.04B
Cash Flow
Free Cash Flow	-177.71M	-9.53M	196.38M	76.07M	-2.68M	470.67M
Operating Cash Flow	-177.71M	-9.53M	196.38M	76.07M	-2.68M	470.67M
Investing Cash Flow	-267.33M	0.00	80.19M	82.32M	0.00	373.36M
Financing Cash Flow	182.52M	-36.76M	-161.36M	-101.91M	-21.33M	-459.70M

MidCap Financial Investment Corporation Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 13.03
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MFIC, the sentiment is Positive. The current price of 13.03 is above the 20-day moving average (MA) of 13.02, above the 50-day MA of 12.91, and above the 200-day MA of 12.61, indicating a bullish trend. The MACD of 0.07 indicates Positive momentum. The RSI at 51.77 is Neutral, neither overbought nor oversold. The STOCH value of 30.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MFIC.

MidCap Financial Investment Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ARCC	73 Outperform	$15.78B	10.93	10.25%	8.56%	7.71%	-29.47%
GSBD	71 Outperform	$1.31B	9.14	9.36%	15.16%	-55.16%	47.09%
MFIC	69 Neutral		12.15	8.34%	13.20%	0.47%	-36.87%
Sector *	68 Neutral	$18.06B	11.97	10.24%	3.74%	9.75%	1.30%
NMFC	65 Neutral	$1.13B	13.93	6.18%	12.34%	39.05%	-32.62%
SCM	64 Neutral	$418.85M	10.11	10.88%	10.85%	65.75%	14.28%
PNNT	48 Neutral	$468.83M	33.35	2.89%	13.26%	-35.46%	-67.15%