WhiteHorse (WHF) AI Stock Analysis

• Market Cap: $206.17M
• Dividend Yield: 20.22%
• Average Volume (3M): 99.49K
• Price to Earnings (P/E): 22.5
• Beta (1Y): 0.33
• Revenue Growth: -27.52%
• EPS Growth: -46.85%
• Country: US
• Employees: 3
• Sector: Financial
• Sector Strength: 73
• Industry: Asset Management
• EPS (TTM): 0.29
• Shares Outstanding: 23,243,088
• 10 Day Avg. Volume: 59,766
• 30 Day Avg. Volume: 99,487
• PEG Ratio: 2.05
• Price to Book (P/B): 0.73
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 6.61
• Enterprise Value/Market Cap: 2.66
• Enterprise Value/Revenue: 1.88
• Enterprise Value/Gross Profit: 10.11
• Enterprise Value/Ebitda: 10.42
• 1Y Price Target: $9.83
• Price Target Upside: 11.33% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 3

• Rating: 67 Neutral
• Price Target: ―

WhiteHorse's overall stock score reflects a solid financial foundation with strong cash flow and no debt. However, challenges such as revenue fluctuations, declining asset values, and mixed earnings call outcomes present risks. The technical analysis and valuation suggest some caution due to potential overbought conditions and a moderately high P/E ratio, balanced by an attractive dividend yield. The stock remains a stable income investment, but with areas needing stabilization and growth.

Positive Factors

Leverage and Asset Management

WhiteHorse Finance has room to add $60M of assets to the portfolio if it makes economic sense for shareholders.

Liquidity Position

Management estimates it has $194.1M of liquidity at quarter-end, consisting of $20.7M in cash and $173.4M in funds available under existing credit facility commitments.

Performance Track Record

WHF has a historically strong track record of turnaround performance, and a 'failed restructuring' is an unusual event.

Negative Factors

Credit Concerns

Non-accruals at cost and fair value have increased, indicating potential financial instability.

Dividend Concerns

Elevated credit concerns in the near-term and a base dividend that is no longer earnable throughout the forecast period for 2025.

Earnings Results

In 3Q24, WhiteHorse Finance lost $0.30/share for a -9.0% ROE as it generated net losses of $16.0M, primarily from markdowns.

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	17.09M	103.26M	21.35M	35.35M	36.02M
Gross Profit	17.09M	103.26M	-1.99M	13.17M	15.25M
EBITDA	11.97M	0.00	36.05M	46.33M	44.72M
Net Income	10.85M	20.41M	15.68M	30.09M	31.68M
Balance Sheet
Total Assets	676.82M	730.75M	796.47M	851.02M	718.99M
Cash, Cash Equivalents and Short-Term Investments	12.42M	10.75M	660.04M	12.19M	8.06M
Total Debt	353.12M	386.76M	441.25M	476.80M	384.88M
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: 8.83
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 8.83 is below the 20-day moving average (MA) of 8.95, above the 50-day MA of 8.82, and below the 200-day MA of 9.31, indicating a neutral trend. The MACD of 0.01 indicates Positive momentum. The RSI at 47.02 is Neutral, neither overbought nor oversold. The STOCH value of 42.75 is Neutral, 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
LIEN	75 Outperform	$233.91M	11.86	8.67%	12.40%	―	―
MRCC	69 Neutral	$134.98M	19.17	3.63%	16.03%	127.09%	2519.30%
WHF	67 Neutral	$206.17M	22.54	3.07%	20.22%	-27.52%	-46.85%
Sector *	65 Neutral	£5.01B	10.90	6.90%	5.18%	24.10%	4.50%
SCM	64 Neutral	$409.19M	10.07	10.83%	11.14%	17.67%	128.48%
TPVG	59 Neutral	$282.03M	7.57	10.68%	16.95%	22.53%	―
NEWT	58 Neutral	$311.36M	5.91	18.20%	6.67%	9.20%	17.37%

WhiteHorse Corporate Events

WhiteHorse to Release Q1 2025 Financial Results

On April 28, 2025, WhiteHorse Finance, Inc. announced that it will release its first quarter financial results for the period ended March 31, 2025, on May 12, 2025. The company will discuss these results during a conference call on May 13, 2025, which will be accessible via teleconference and webcast. This announcement is significant for stakeholders as it provides insights into the company’s financial performance and strategic direction.

Spark’s Take on WHF Stock

According to Spark, TipRanks’ AI Analyst, WHF is a Neutral.

WhiteHorse’s financial performance is strong, with no debt and consistent cash flow generation. However, revenue and asset fluctuations indicate potential volatility. Technical indicators suggest neutral momentum, while valuation metrics present a mixed picture with an attractive but possibly risky dividend yield. The recent earnings call revealed some operational challenges, notably in NAV and nonaccrual investments, which temper the overall outlook.

To see Spark’s full report on WHF stock, click here.