WhiteHorse (WHF) AI Stock Analysis

• Market Cap: $224.30M
• Dividend Yield: 15.96%
• Average Volume (3M): 88.16K
• Price to Earnings (P/E): 20.7
• Beta (1Y): 0.45
• Revenue Growth: -27.52%
• EPS Growth: -46.85%
• Country: US
• Employees: 3
• Sector: Financial
• Sector Strength: 82
• Industry: Asset Management
• EPS (TTM): 0.47
• Shares Outstanding: 23,243,088
• 10 Day Avg. Volume: 91,821
• 30 Day Avg. Volume: 88,156
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• Price to Cash Flow (P/CF): 2.70
• P/FCF Ratio: 2.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $10.00
• Price Target Upside: 4.38% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 2

WhiteHorse's overall stock score reflects strong financial management and cash flow generation, but is tempered by technical weakness and valuation concerns. Notably, the earnings call highlighted mixed performance, with strong capital deployment offset by declines in net asset value and increased nonaccrual investments. The stock's high dividend yield may appeal to income investors, though the relatively high P/E ratio suggests caution regarding overvaluation.

Positive Factors

Leverage Capacity

WhiteHorse Finance is positioned at the high end of its target leverage range, with potential to add $60M of assets if beneficial for shareholders.

Liquidity

WhiteHorse Finance has substantial liquidity at the quarter-end, with $194.1M available through cash and credit facilities.

Negative Factors

Credit Concerns

Elevated credit concerns have emerged, along with a base dividend that is no longer sustainable throughout the forecast period for 2025.

Earnings

WhiteHorse Finance reported a net loss of $16.0M, resulting in a negative return on equity of -9.0% for the quarter.

Non-Accruals

The increase in non-accruals to a fair value of $34.2M raises potential financial instability concerns.

Yield Performance

The decline in the weighted average annualized yield on debt investments to 10.6% from 11.7% reflects potential challenges in generating returns.

WhiteHorse Business Overview & Revenue Model

Company Description

WhiteHorse Finance, Inc. is business development company, non-diversified, closed end management company specializing in originating senior secured loans, lower middle market, growth capital industries. It prefers to invest in United States. It typically invests between $5 million to $25 million in companies having enterprise value of between $50 million and $350 million.

How the Company Makes Money

WhiteHorse Finance makes money through the interest and fees generated from the loans it extends to small and middle-market businesses. The company earns interest income from its loan portfolio, which typically consists of senior secured loans that offer a favorable risk-return profile. Additionally, WHF may generate revenue through equity investments in certain portfolio companies, which can provide capital appreciation and dividend income. The company benefits from its strategic partnerships with other financial institutions and sponsors, which can enhance deal flow and investment opportunities. Furthermore, WhiteHorse Finance's focus on maintaining a diversified portfolio helps mitigate risk and stabilize earnings.

WhiteHorse Financial Statement Overview

Summary

WhiteHorse demonstrates a robust financial performance with strong cash flow generation and no debt burdens. However, fluctuations in revenue and asset values suggest volatility in business operations, which could pose challenges. The company's strength lies in its ability to manage costs and maintain profitability, supported by its strong cash position. Going forward, stabilizing revenue streams and asset growth will be key areas to address.

Income Statement

WhiteHorse has shown strong revenue growth over recent years with a significant increase in EBIT margins. The gross profit margin remains at 100% due to the nature of its asset management business. However, the recent dip in revenue in 2024 compared to 2023 may indicate a fluctuation in revenue streams. The net profit margin is robust, reflecting effective cost management despite revenue volatility.

Balance Sheet

The balance sheet is solid with no total debt as of 2024, highlighting financial stability. The equity ratio is healthy, ensuring that a substantial part of assets is funded by equity rather than liabilities. However, there was a decrease in total assets over the years, and the return on equity has been fluctuating, indicating potential concerns about consistent profitability.

Cash Flow

Operating cash flow has been positive and consistent, supporting strong free cash flow figures. The company has managed to improve its operating cash flow to net income ratio, showcasing effective cash generation from operations. Despite considerable fluctuations in investing and financing cash flows, free cash flow growth remains positive, ensuring liquidity and operational efficiency.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
92.82M	103.26M	21.35M	35.35M	36.02M
	Gross Profit
92.82M	103.26M	-1.99M	13.17M	15.25M
	EBIT
87.69M	73.59M	60.22M	31.10M	32.43M
	EBITDA
0.00	0.00	36.05M	46.33M	44.72M
	Net Income Common Stockholders
10.85M	20.41M	15.68M	30.09M	31.68M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
26.97M	10.75M	660.04M	12.19M	8.06M
	Total Assets
676.82M	730.75M	796.47M	851.02M	718.99M
	Total Debt
0.00	386.76M	441.25M	476.80M	384.88M
	Net Debt
-26.97M	-10.75M	431.74M	464.61M	376.82M
	Total Liabilities
390.69M	413.98M	464.09M	501.27M	406.09M
	Stockholders Equity
286.13M	316.77M	332.39M	349.75M	312.90M
Cash Flow		Free Cash Flow
78.76M	90.37M	71.99M	-90.19M	-64.60M
	Operating Cash Flow
78.76M	90.37M	71.99M	-90.19M	-64.60M
	Investing Cash Flow
0.00	0.00	323.08M	423.63M	213.79M
	Financing Cash Flow
-75.40M	-92.13M	-68.49M	97.01M	52.98M

WhiteHorse Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 9.58
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WHF, the sentiment is Negative. The current price of 9.58 is below the 20-day moving average (MA) of 9.68, below the 50-day MA of 10.00, and below the 200-day MA of 10.23, indicating a bearish trend. The MACD of -0.14 indicates Positive momentum. The RSI at 44.37 is Neutral, neither overbought nor oversold. The STOCH value of 12.62 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WHF.

WhiteHorse Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ARCC	76 Outperform	$15.13B	9.06	12.40%	8.68%	19.95%	-10.57%
MAIN	74 Outperform	$5.02B	9.68	19.26%	5.25%	51.80%	12.05%
NMFC	67 Neutral	$1.19B	10.76	8.49%	11.60%	-3.55%	-20.43%
Sector *	63 Neutral	$14.35B	9.94	8.94%	4.37%	16.34%	-11.76%
WHF	61 Neutral	$224.30M	20.67	3.60%	15.96%	-27.52%	-46.85%
TCPC	58 Neutral	$681.47M	―	-8.57%	16.98%	8.24%	-207.60%
PNNT	53 Neutral	$459.03M	28.15	3.28%	12.94%	―	-66.59%

WhiteHorse Corporate Events

WhiteHorse to Announce 2024 Financial Results in March

WhiteHorse Finance, Inc. announced on February 3, 2025, that it will release its fourth quarter and full year financial results for the year ending December 31, 2024, on March 7, 2025. The company will discuss these results in a conference call on the same day, providing stakeholders insights into its performance and strategic positioning within the industry.