Stock Analysts’ New Coverage for April, 22nd (BKG, CNP, CTRN, EQM, EVOK, KR, MRG.UN, MRT.UN, OKS, SPWRA)
Numis Securities Ltd assumed coverage on shares of Berkeley Group Holdings PLC (LON:BKG). They issued a buy rating on the stock.
Tudor Pickering initiated coverage on shares of CenterPoint Energy (NYSE:CNP). The firm issued a buy rating on the stock.
Citigroup Inc. initiated coverage on shares of Citi Trends (NASDAQ:CTRN). The firm issued a buy rating on the stock.
ISI Group started coverage on shares of EQT Midstream Partners (NYSE:EQM). They issued a strong-buy rating and a $85.00 price target on the stock.
Feltl & Co. assumed coverage on shares of Evoke Pharma (NASDAQ:EVOK). They issued a strong-buy rating on the stock.
Wells Fargo & Co. began coverage on shares of The Kroger (NYSE:KR). The firm issued a market perform rating on the stock.
RBC Capital assumed coverage on shares of Morguard North American Residential REIT (TSE:MRG.UN). The firm issued an outperform rating on the stock.
RBC Capital began coverage on shares of Morguard Real Estate Inv. (TSE:MRT.UN). RBC Capital issued an outperform rating on the stock.
ISI Group assumed coverage on shares of Oneok Partners (NYSE:OKS). The firm issued a neutral rating and a $59.00 target price on the stock.
Brean Capital initiated coverage on shares of SunPower (NASDAQ:SPWRA). Brean Capital issued a buy rating on the stock.
National Securities started coverage on shares of TCP Capital Corp. (NASDAQ:TCPC). National Securities issued a neutral rating and a $17.00 target price on the stock. The analysts wrote, “We are initiating coverage of TCP Capital Corp. (TCPC) with a
Neutral rating and $17 price target. The company’s cost of debt funding is among the
lowest within the BDC sector, and we believe its relatively low-cost fee structure is more
favorable compared to the majority of externally-managed BDCs. Furthermore, given
that the company’s net investment income is currently exceeding its dividend
distribution, and it had roughly $27 million of spillover income at the end of 2013, we
believe the current dividend is clearly sustainable over the near term. In our view, TCP
could potentially raise its dividend at least modestly and/or continue to pay periodic
special dividends to distribute excess taxable earnings. With no debt investments on nonaccrual
status, we believe the portfolio’s credit quality is currently strong, and do not
believe credit quality deterioration is a significant near term risk, especially considering
the company’s focus on senior secured investments and the current benign credit
environment. The company currently has ample dry powder to fund new investments
following its two equity offerings during 4Q13, and TCP recently gained approval for its
SBIC (Small Business Investment Company) license in April 2014, suggesting the
company may issue SBA debentures over time to fund new investments, which could add
highly accretive, low-cost, fixed rate debt to its funding mix. Despite these positives, the
company’s shares currently trade at a premium valuation compared to BDC peers, and
we would wait for a more attractive entry point to consider purchasing the stock. Our
$17 price target implies an estimated P/2015 NII multiple of 10.6x, dividend yield of
8.5%, and P/NAV multiple of 1.12x compared to our estimated BDC sector medians of
roughly 9.9x, 9.8%, and 0.98x, respectively.”
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