FBR Capital Reiterates Market Perform as Capitala Finance (CPTA) Announces Dividend Reduction
- Dow, S&P hit highs; Trump comment hammers drug stocks
- Unusual 11 Mid-Day Movers 12/7: (ANTH) (EMKR) (PLAY) Higher; (SIGM) (OHAI) (FTK) Lower
- Abbott (ABT) Files Complaint to Terminate Alere (ALR) Acquisition
- Western Digital (WDC) Raises Q2 Outlook
- Biotech, Pharma Stocks Weaker Amid Trump Comments on Lower Drug Prices
Get inside Wall Street with StreetInsider Premium. Claim your 2-week free trial here.
FBR Capital reiterated a Market Perform rating and $15.00 price target on Capitala Finance (NASDAQ: CPTA) following the company's announcement that it has reduced its quarterly dividend. The dividend has been reduced to $0.39/ share from $0.47/share for 4Q16. This is in line with prior expectations that the dividend would be reduced to $0.40/share.
Analyst Christopher Nolan commented, "We are maintaining our EPS estimates, Market Perform rating, and $15 price target following CPTA’s announced quarterly dividend reduction. The quarterly dividend was reduced to $0.39/share from $0.47/share for 4Q16 and is consistent with our previously modeled expectations. The lower dividend, in part, reflects portfolio exits, particularly from the energy sector, and could also mean a slowing pace of new deal origination in 3Q16 given management indicated it is not chasing yield for new investments. This likely reflects competitive market pricing for lower middle market investments, but it is also positive in that it means CPTA is not pursuing yields at the cost of increased portfolio risk. Going forward, we believe the lower dividend is likely to eliminate the need for the management fee waiver. However, we believe the waiver remains in place to ensure continued full coverage of the dividend by EPS. In our view, this credibly reflects on management."
Shares of Capitala Finance closed at $14.57 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Capitala Finance (CPTA) Made $23M Investment in Xirgo Technologies
- UPDATE: Seaport Global Securities Starts Beacon Roofing Supply (BECN) at Buy
- KLR Group Raise Price Target on Oasis Petroleum (OAS) to $22; Reiterates Buy
Create E-mail Alert Related CategoriesAnalyst Comments
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!