MidCap Financial Q3 net investment income falls

Overview

• U.S. middle-market lender's Q3 net investment income per share declined from prior quarter

• NAV per share fell 3.8% due to portfolio losses from credit-related weakness

• In Oct, Ares Capital said it would acquire MFIC in stock-and-cash deal valued at $10.88 per share

Outlook

• Company has suspended share repurchase program and will suspend dividend reinvestment plan soon

• Company expects to repay and terminate credit facility upon closing of acquisition

Result Drivers

• CREDIT-RELATED WEAKNESS - Co said portfolio losses were due to credit-related weakness in a limited number of positions

• HIGH REPAYMENTS - Co reported significant net repayments, including a large repayment from Merx, reducing portfolio size

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", 4 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the investment management & fund operators peer group is "buy"

• Wall Street's median 12-month price target for MidCap Financial Investment Corp is $10.25, about 0.8% below its November 4 closing price of $10.33

• The stock recently traded at 8 times the next 12-month earnings vs. a P/E of 7 three months ago

Reuters Recommended Reads

• Nov 2 - New Mountain Finance Q3 adjusted net investment income falls YoY

• Nov 4 - TriplePoint Venture Growth Q3 net investment income falls, NAV per share declines

• Nov 3 - Sixth Street Specialty Lending Q3 adjusted EPS misses estimates

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)