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Trinity Capital (TRIN)
NASDAQ:TRIN
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Trinity Capital (TRIN) AI Stock Analysis

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TRIN

Trinity Capital

(NASDAQ:TRIN)

Rating:80Outperform
Price Target:
$18.50
â–²(14.27% Upside)
Trinity Capital's strong technical indicators and attractive valuation are the most significant factors driving the high score. The company's robust financial performance and positive earnings call sentiment further support the score, despite concerns over cash flow management.
Positive Factors
Equity Issuance
TRIN benefited from accretive equity issuance and elevated portfolio activity this quarter.
Portfolio Performance
NAV improved through mostly unrealized gains from equity investments including EdenIq, Ogee, and the Trinity Adviser.
Negative Factors
Credit Exposure
Potential credit impacts from growing exposures to discounted real estate credits and weakening recurring dividend coverage.
Debt Extinguishment
TRIN repaid its pre-IPO convertible notes in cash, which will result in a ~$0.16 / share realized loss from debt extinguishment as they were in-the-money.
Dividend Coverage
TRIN remains dependent on prepays for dividend coverage, and the gap between 'recurring' NOI and the dividend is growing.

Trinity Capital (TRIN) vs. SPDR S&P 500 ETF (SPY)

Trinity Capital Business Overview & Revenue Model

Company DescriptionTrinity Capital Inc. is a business development company. It is a venture capital firm specializing in venture debt to growth stage companies looking for loans and/or equipment financing. Trinity Capital Inc. was founded in 2019 is based in Phoenix, Arizona with additional offices in Lutherville-Timonium, Maryland, San Diego, California and Austin, Texas.
How the Company Makes MoneyTrinity Capital makes money by providing capital in the form of debt financing to growth-stage companies. The company generates revenue through the interest and fees charged on these loans and equipment financings. Trinity Capital targets venture capital-backed companies that require financial support to fuel their expansion and development. The company's key revenue streams include interest income from loan agreements, origination fees associated with new financings, and potential equity participation through warrants or other equity-linked instruments. Additionally, Trinity Capital's expertise in tailoring solutions to meet the specific needs of its clients allows it to maintain strong relationships and partnerships with venture capital firms, which can contribute to a steady pipeline of potential clients and revenue opportunities.

Trinity Capital Earnings Call Summary

Earnings Call Date:Aug 06, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Nov 05, 2025
Earnings Call Sentiment Positive
Trinity Capital had a strong second quarter, demonstrating significant growth in net investment income and net asset value. They achieved an investment-grade rating and received approval for an SBIC fund, indicating a positive outlook for future growth. Despite the positive momentum, there was an increase in the watch list portfolio, which could pose challenges. Overall, the sentiment is largely positive given the outweighing highlights.
Q2-2025 Updates
Positive Updates
Significant Increase in Net Investment Income
Trinity Capital delivered $34.8 million of net investment income, a 30% increase compared to the same quarter last year.
Record Net Asset Value Growth
The company's net asset value grew 11% quarter-over-quarter to a record $924 million.
Strong Dividend Performance
Trinity Capital paid a second quarter cash dividend of $0.51 per share, marking the 22nd consecutive quarter of consistent regular dividends.
Investment-Grade Rating Achievement
In May, Trinity Capital received an investment-grade rating from Moody's, allowing access to debt capital at more favorable rates.
SBIC Fund Greenlight
Received a greenlight letter from the SBA to launch an SBIC fund, potentially providing $275 million of investable capital.
Return on Equity and Effective Yield
Trinity's return on equity and effective yield are among the top in the BDC space, with an effective yield of 15.7% in Q2.
Strong Portfolio Performance and Low Nonaccruals
Nonaccruals represent less than 1% of the portfolio at fair value, with a stable portfolio performance.
Strong Half-Year Funding and Pipeline
In the first half of 2025, Trinity funded $585 million, surpassing last year's first half by over 20%, with strong investment pipeline.
Negative Updates
Increase in Watch List Portfolio
There was a notable increase in the watch list at fair value quarter-over-quarter, indicating some portfolio companies need additional capital or are underperforming.
Company Guidance
In the second quarter of 2025, Trinity Capital demonstrated robust financial performance and growth across various metrics. The company reported a net investment income of $34.8 million, marking a 30% increase compared to the same quarter last year, alongside a total investment income of $69.5 million, up 27% from the previous year. The net asset value rose by 11% quarter-over-quarter to $924 million, with a platform AUM exceeding $2.3 billion. Trinity Capital maintained strong credit quality, with nonaccruals constituting less than 1% of the portfolio at fair value. The company distributed a cash dividend of $0.51 per share for the quarter, marking its 22nd consecutive quarter of regular dividends. Additionally, the company received an investment-grade rating from Moody's and a greenlight letter from the Small Business Administration to launch an SBIC fund, potentially adding $275 million of investable capital. Trinity Capital's return on equity and effective yield remained high within the BDC space, with a return on average equity of 15.9%. The firm also reported a 36% year-over-year growth in NAV and an 88% cumulative return on TRIN stock since its IPO. The company continues to expand its portfolio through its five business verticals, maintaining a diversified and resilient approach.

Trinity Capital Financial Statement Overview

Summary
Trinity Capital has shown strong revenue and profit growth with impressive margins, reflecting robust operational performance. However, high liabilities and negative cash flow are areas of concern, indicating potential risks in cash flow management.
Income Statement
78
Positive
Trinity Capital has demonstrated strong revenue growth, increasing from $9.39 million in 2022 to $226.73 million in 2024. The gross profit margin for 2024 is 80.8%, indicating efficient cost management. The net profit margin has also improved substantially to 52.3% in 2024, showcasing strong profitability. However, the revenue growth rate has been volatile, with significant fluctuations over the years.
Balance Sheet
70
Positive
The company has improved its equity base from $238.75 million in 2020 to $822.98 million in 2024, reflecting strong shareholder support and financial stability. The debt-to-equity ratio has decreased, indicating better leverage management. However, the equity ratio stands at 46.4% for 2024, suggesting moderate reliance on debt financing. While the return on equity is impressive at 14.4% for 2024, indicating good profitability, the high total liabilities remain a concern.
Cash Flow
65
Positive
Trinity Capital shows negative free cash flow for consecutive years, with a significant outflow of $316.91 million in 2024. This suggests challenges in generating positive cash flow from operations. The operating cash flow to net income ratio is negative, indicating that earnings are not translating effectively into cash flows. However, the company has managed to secure financing, as seen by the positive financing cash flow.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue246.65M226.73M174.84M9.39M155.09M23.82M
Gross Profit224.47M183.21M141.75M-17.80M139.57M13.39M
EBITDA175.07M177.54M121.19M101.46M0.000.00
Net Income138.76M115.60M76.89M-30.38M132.32M-6.11M
Balance Sheet
Total Assets2.05B1.77B1.31B1.13B937.12M559.71M
Cash, Cash Equivalents and Short-Term Investments26.25M9.63M4.76M47.92M31.68M44.66M
Total Debt0.00877.67M646.89M610.59M455.35M299.75M
Total Liabilities1.12B951.26M699.82M666.79M490.58M320.96M
Stockholders Equity923.57M822.98M611.16M459.65M446.53M238.75M
Cash Flow
Free Cash Flow-234.58M-317.33M-99.00M-235.94M-242.88M-58.48M
Operating Cash Flow-234.14M-316.91M-96.26M-235.74M-241.67M-58.23M
Investing Cash Flow-88.32M-420.00K-2.74M-194.00K-1.20M-91.98M
Financing Cash Flow381.19M322.19M93.15M199.81M228.52M211.31M

Trinity Capital Technical Analysis

Technical Analysis Sentiment
Positive
Last Price16.19
Price Trends
50DMA
15.15
Positive
100DMA
14.54
Positive
200DMA
14.27
Positive
Market Momentum
MACD
0.29
Positive
RSI
71.94
Negative
STOCH
80.96
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TRIN, the sentiment is Positive. The current price of 16.19 is above the 20-day moving average (MA) of 15.95, above the 50-day MA of 15.15, and above the 200-day MA of 14.27, indicating a bullish trend. The MACD of 0.29 indicates Positive momentum. The RSI at 71.94 is Negative, neither overbought nor oversold. The STOCH value of 80.96 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TRIN.

Trinity Capital Peers Comparison

Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
80
Outperform
$1.14B7.2717.31%12.61%31.43%30.85%
74
Outperform
$1.27B14.339.74%9.99%12.82%-5.37%
71
Outperform
$908.33M10.238.95%9.83%5.87%-12.64%
68
Neutral
$18.05B11.7310.24%3.73%9.66%1.70%
66
Neutral
$1.01B9.389.42%11.50%-3.29%-16.86%
65
Neutral
$1.12B13.936.18%12.31%39.05%-32.62%
63
Neutral
$1.01B12.057.37%11.96%55.25%-47.71%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TRIN
Trinity Capital
16.19
4.02
33.03%
CSWC
Capital Southwest
23.00
0.75
3.37%
NMFC
New Mountain Finance
10.54
-0.37
-3.39%
PFLT
Pennantpark $
10.28
0.05
0.49%
SLRC
SLR Investment Corp.
16.69
2.37
16.55%
BCSF
Bain Capital Specialty Finance
15.65
0.21
1.36%

Trinity Capital Corporate Events

Private Placements and FinancingBusiness Operations and Strategy
Trinity Capital Enters $250M Stock Sale Agreement
Neutral
Aug 29, 2025

On August 29, 2025, Trinity Capital Inc. entered into open market sale agreements with Jefferies LLC, B. Riley Securities, Inc., Keefe, Bruyette & Woods, Inc., and Compass Point Research & Trading, LLC, allowing the company to issue and sell up to $250 million in shares of its common stock. The proceeds from this offering are intended for investments aligned with the company’s strategy and general corporate purposes, potentially impacting its market operations and stakeholder interests.

Financial Disclosures
Trinity Capital Reports Strong Q2 2025 Financial Results
Positive
Aug 6, 2025

On August 6, 2025, Trinity Capital Inc. reported its financial results for the second quarter of 2025, highlighting a 27.3% year-over-year increase in total investment income, reaching $69.5 million. The company’s Net Asset Value (NAV) hit a new high of $923.6 million, marking a 35.8% increase from the previous year. The quarter also saw a net increase in net assets resulting from operations of $41.4 million. Trinity Capital’s strong performance was attributed to disciplined execution across its credit strategies and sustained demand from growth-oriented companies, as noted by CEO Kyle Brown. The company maintained its momentum in direct lending and RIA platform growth, with a focus on delivering value to borrowers, partners, and investors.

Private Placements and FinancingBusiness Operations and StrategyFinancial Disclosures
Trinity Capital Announces Q2 2025 Portfolio Activity
Positive
Jul 10, 2025

Trinity Capital Inc. announced its portfolio activity for the second quarter of 2025, originating $519 million in new commitments and funding $365 million in investments. The company plans to release its complete second quarter financial results on August 6, 2025, with a conference call scheduled the same day to discuss these results. This announcement highlights Trinity Capital’s significant activity in secured loans and equipment financings, as well as its strategic funding to both new and existing portfolio companies. The company’s robust portfolio activity underscores its strong positioning in the alternative asset management industry, potentially impacting stakeholders by demonstrating its capability to generate substantial new commitments and manage repayments effectively.

Private Placements and FinancingBusiness Operations and Strategy
Trinity Capital Issues $125 Million in Senior Notes
Neutral
Jul 3, 2025

On July 3, 2025, Trinity Capital Inc. entered into a seventh supplemental indenture with U.S. Bank Trust Company to issue $125 million in 6.750% notes due in 2030. The notes, which are unsecured obligations, rank senior to subordinated debt and are intended to repay outstanding secured indebtedness with KeyBank, National Association. This move is part of Trinity Capital’s strategy to manage its debt obligations and improve its financial positioning.

Private Placements and Financing
Trinity Capital Announces $125 Million Notes Issuance
Neutral
Jul 1, 2025

On June 26, 2025, Trinity Capital Inc. entered into an underwriting agreement with Keefe, Bruyette & Woods, Inc. and Morgan Stanley & Co. LLC for the issuance and sale of $125 million in 6.750% Notes due 2030. This transaction, expected to close on July 3, 2025, involves customary representations, warranties, and indemnification provisions, and was made under the company’s effective shelf registration statement.

Executive/Board ChangesShareholder Meetings
Trinity Capital Re-elects Directors at Annual Meeting
Neutral
Jun 16, 2025

On June 12, 2025, Trinity Capital Inc. held its Annual Meeting of Stockholders where two key proposals were voted upon. The stockholders re-elected two directors, Irma Lockridge and Steven L. Brown, to the Board of Directors and ratified the selection of Ernst & Young LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025.

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.Date of analysis: Aug 29, 2025