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New Mountain Finance
(NASDAQ:NMFC)
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Rating:62Neutral
Price Target:
$7.50
â–²(9.65% Upside)
Action:Reiterated
Date:08/04/26
NMFC scores in the low 60s primarily due to mixed financial performance: excellent cash flow and solid revenue growth are offset by a recent swing to net losses and meaningful leverage. The earnings call adds moderate support via dividend coverage, improving non-accruals, and discounted buybacks, while technicals remain neutral-to-cautious and valuation is helped by a very high yield but tempered by negative earnings (negative P/E).
Positive Factors
Strong cash generation
Consistently large operating and free cash flow ($660.6M TTM) provides durable coverage for dividends, debt service and opportunistic buybacks. Strong cash generation cushions the business against accounting losses and gives management flexibility to fund investments and absorb credit dislocations over months.
Negative Factors
Profitability deterioration
A swing to a TTM net loss and volatile margins weaken internal capital generation and make future dividend coverage more dependent on realized gains or high cashflows. Persistently negative ROE reduces retained earnings accumulation and elevates reliance on external financing or asset sales over months.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Consistently large operating and free cash flow ($660.6M TTM) provides durable coverage for dividends, debt service and opportunistic buybacks. Strong cash generation cushions the business against accounting losses and gives management flexibility to fund investments and absorb credit dislocations over months.
Read all positive factors
New Mountain Finance (NMFC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$705.56M
Dividend Yield16.24%
Average Volume (3M)709.65K
Price to Earnings (P/E)―
Beta (1Y)0.58
Revenue Growth-50.21%
EPS Growth-161.42%
CountryUS
EmployeesN/A
SectorFinancial
Sector Strength70
IndustryAsset Management
Share Statistics
EPS (TTM)-0.48
Shares Outstanding94,452,390
10 Day Avg. Volume506,680
30 Day Avg. Volume709,652
Financial Highlights & Ratios
PEG Ratio-0.68
Price to Book (P/B)0.83
Price to Sales (P/S)7.06
P/FCF Ratio2.58
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$7.75Price Target Upside13.30% Upside
Rating ConsensusHold
Number of Analyst Covering2
EPS Forecast (FY)1.09
Revenue Forecast (FY)$257.88M
New Mountain Finance Business Overview & Revenue Model
Company Description
New Mountain Finance Corporation (NMFC), a Nasdaq-listed business development company (BDC), operates as both a private equity and lending vehicle. It specializes in providing capital through direct investments and loans to middle-market companies...
How the Company Makes Money
NMFC primarily makes money from investment income generated on its portfolio of loans and other investments. The core revenue stream is interest income earned on senior secured and subordinated debt investments, which may be structured with floati...
New Mountain Finance Earnings Call Summary
Earnings Call Date:Aug 03, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Neutral
The call presents a balanced picture: management highlighted coverage of the dividend, improved non-accruals, active buybacks at deep discounts, strong liquidity and deliberate liability management, and a high implied dividend yield. Offsetting these positives are a notable QoQ decline in total investment income (-11%), muted M&A and origination activity (industry volume down ~55% QoQ), PIK exposure (13% of investment income), specific write-downs (Convey) and remaining portfolio concentration. Management expressed optimism about portfolio monetizations and NAV upside, but material near-term execution and market risks remain.Positive Updates
Dividend Coverage and Stability
Adjusted net investment income of $0.26 per share in Q2 covered the $0.25 per share dividend; Board declared a $0.25 dividend for Q3 and management expects NII to continue covering the dividend.
Negative Updates
Quarterly Investment Income Decline
Total investment income was $61M in Q2, down approximately 11% from the prior quarter, primarily reflecting a smaller, more senior and diversified portfolio after the secondary sale.
Read all updates
Q2-2026 Updates
Positive
Negative
Dividend Coverage and Stability
Adjusted net investment income of $0.26 per share in Q2 covered the $0.25 per share dividend; Board declared a $0.25 dividend for Q3 and management expects NII to continue covering the dividend.
Read all positive updates
Company Guidance
Management guided that Q2 adjusted net investment income was $0.26 per share (covering the $0.25 quarterly dividend), with a $0.25 dividend declared for Sept. 30 (record Sept. 16) and an expectation that NII will continue to cover dividends; NAV was $10.89 (down $0.03, ~30 bps q/q), non‑accruals at fair value improved to 1.5% from 2.6%, loan‑to‑value is 49%, 88% of the portfolio is rated green (non‑green names carry a weighted average mark of ~$0.67), the portfolio is ~80% senior with equity ~6% across 113 companies (top 10 = 24%), and they repurchased ~$9M of stock in Q2 at ~ $8/share (~27% discount), $66M YTD repurchases with ~ $80M remaining capacity. Q2 totals: investment income $61M (‑11% QoQ), total net expenses ~$37M, effective incentive fee 15% after a $1.4M waiver; PIK from origination was 13% of investment income (modified PIK 3%), PIK assets marked ~95% of par and 89% of that income came from green names. Balance sheet and capital guidance: total assets $2.4B, liabilities $1.4B, NAV ~$1.0B ($10.89/share), net debt/equity 1.11x (target range 1.0–1.25x), >$2B total borrowing capacity including ~ $830M available under credit facilities (covering ~ $160M unfunded commitments and 2027 maturities), closed a $150M delayed‑funding private placement, extended the revolver to 2031, ~60% of debt maturing 2029 or later, loan portfolio 89% floating / 11% fixed and liabilities 74% floating / 26% fixed; management reiterated plans to continue opportunistic buybacks within leverage targets, remain active in the unsecured market, and permanently reduce fees to 15% by 2027, noting spreads for insulated sectors have stabilized around SOFR +500 bps.New Mountain Finance Financial Statement Overview
Summary
Income Statement
44
Neutral
Balance Sheet
52
Neutral
Cash Flow
78
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 171.31M | 138.56M | 329.83M | 341.98M | 347.33M | 267.10M |
| Gross Profit | 122.97M | 14.84M | 247.44M | 258.08M | 271.32M | 193.31M |
| EBITDA | 83.40M | 17.40M | 253.51M | 262.64M | 176.25M | 280.51M |
| Net Income | -48.37M | 16.49M | 113.44M | 135.34M | 74.73M | 201.40M |
Balance Sheet | ||||||
| Total Assets | 2.42B | 2.90B | 3.25B | 3.16B | 3.35B | 3.30B |
| Cash, Cash Equivalents and Short-Term Investments | 64.80M | 80.72M | 80.32M | 70.09M | 71.19M | 58.08M |
| Total Debt | 1.35B | 1.67B | 1.84B | 1.79B | 1.98B | 1.91B |
| Total Liabilities | 1.38B | 1.71B | 1.89B | 1.83B | 2.03B | 1.95B |
| Stockholders Equity | 1.03B | 1.18B | 1.35B | 1.32B | 1.31B | 1.32B |
Cash Flow | ||||||
| Free Cash Flow | 660.55M | 378.98M | 42.00M | 76.00M | 70.12M | 51.69M |
| Operating Cash Flow | 660.55M | 378.98M | 42.00M | 76.00M | 70.12M | 51.69M |
| Investing Cash Flow | 62.00K | 0.00 | 0.00 | 256.80M | -36.92M | -68.01M |
| Financing Cash Flow | -653.02M | -378.74M | -31.36M | -333.96M | -19.69M | -4.53M |
New Mountain Finance Technical Analysis
Negative
6.84
Price Trends
7.25
Positive
7.55
Negative
7.84
Negative
Market Momentum
0.13
Negative
52.55
Neutral
45.70
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NMFC, the sentiment is Negative. The current price of 6.84 is below the 20-day moving average (MA) of 7.31, below the 50-day MA of 7.25, and below the 200-day MA of 7.84, indicating a neutral trend. The MACD of 0.13 indicates Negative momentum. The RSI at 52.55 is Neutral, neither overbought nor oversold. The STOCH value of 45.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NMFC.
New Mountain Finance Risk Analysis
New Mountain Finance disclosed 26 risk factors in its most recent earnings report. New Mountain Finance 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
New Mountain Finance Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $1.70B | 9.33 | 13.88% | 11.82% | 8.54% | -23.45% | |
70 Outperform | $774.74M | 22.03 | 3.25% | 15.44% | 11.89% | -58.67% | |
69 Neutral | $720.32M | 14.23 | 4.09% | 17.37% | 12.58% | -40.06% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
66 Neutral | $691.21M | 9.39 | 6.61% | 11.90% | -3.92% | -16.93% | |
65 Neutral | $782.31M | 9.95 | 7.10% | 15.29% | -11.58% | -40.72% | |
62 Neutral | $705.56M | -15.56 | -4.28% | 17.69% | -50.21% | -161.42% |
* Financial Sector Average
NMFC
New Mountain Finance
7.45
-1.58
-17.48%
PFLT
Pennantpark
7.32
-1.60
-17.91%
SLRC
SLR Investment Corp.
12.65
-2.23
-15.00%
CGBD
Carlyle Secured Lending Inc
11.21
-0.84
-6.95%
BCSF
Bain Capital Specialty Finance
12.07
-1.31
-9.78%
TRIN
Trinity Capital
18.15
4.46
32.59%
New Mountain Finance Corporate Events
Business Operations and StrategyDividendsFinancial Disclosures
New Mountain Finance Reports Solid Q2 Results, Maintains Dividend
Positive
Aug 3, 2026
New Mountain Finance Corporation reported financial results on August 3, 2026 for the quarter ended June 30, 2026, posting adjusted net investment income of $24.7 million, or $0.26 per share, with net asset value per share edging slightly down to ...
Business Operations and StrategyPrivate Placements and Financing
New Mountain Finance Plans $150 Million Senior Notes Offering
Positive
Jun 18, 2026
On June 18, 2026, New Mountain Finance Corporation entered into a supplement to its existing note purchase agreement, enabling the private placement of up to $150 million in Series 2026A senior notes across three tranches: fixed-rate Tranche A not...
Business Operations and StrategyPrivate Placements and Financing
New Mountain Finance Prices $150 Million Senior Notes
Positive
Jun 5, 2026
New Mountain Finance Corporation has priced a private offering of three tranches of Series 2026A senior notes totaling $150 million, comprising $40 million of 7.28% fixed-rate notes due 2028, $35 million of 7.76% fixed-rate notes due 2031 and $75 ...
Executive/Board ChangesShareholder Meetings
New Mountain Finance Shareholders Affirm Board and Auditor
Positive
May 15, 2026
New Mountain Finance Corporation reported on the results of its 2026 Annual Meeting of Stockholders, held on May 12, 2026, where shareholders voted on board composition and the company’s external auditor. Investors elected three directors...
Business Operations and StrategyExecutive/Board ChangesStock BuybackDividendsFinancial Disclosures
New Mountain Finance Names Interim CFO, Updates Portfolio Strategy
Neutral
May 4, 2026
New Mountain Finance said that on May 4, 2026 its board appointed Chief Operating Officer Laura C. Holson as interim chief financial officer and treasurer, effective May 29, 2026, while it searches for a permanent successor. Holson, a New Mountain...
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.