Eagle Point Credit Co. (ECC) Rating Reiterated by National Securities
Eagle Point Credit Co. (NYSE:ECC)‘s stock had its “buy” rating reaffirmed by analysts at National Securities in a research report issued on Monday. They presently have a $24.00 price target on the investment management company’s stock.
The analysts wrote, “The Preferred Offering: Eagle Point Credit Company (ECC) issued 1.2 million shares of its Series B preferred stock with a 7.75% coupon with 180,000 shares of overallotment, which we anticipate will be taken up in full. This would equate to gross proceeds of $34.5 million and net proceeds of $33.0 million, by our estimates. After a net common stock offering of $20.7 million and a $25.0 million debt offering in 2Q16, we think that this offering in 4Q16 bodes well for the pipeline of opportunities. Seeing as the volatility in the first half of the year permitted ECC to make highly accretive secondary market purchases with effective yields north of 35%, we expect that the 4Q16 preferred raise will likely be used by ECC to structure its own transactions and earn fee rebates – the bread and butter of its business model. ECC’s NAV/share estimate as of 8/31/16 was $16.72, up 15.6% from $14.46 as of 6/30/16. The strong rebound in loan prices and CLO equity will likely drive a $34.3 million of unrealized appreciation during the quarter. We expect that the company will increase its total portfolio at par to $609.9 million in 4Q16 and $712.1 million in 4Q17 from $441.4 million as of 6/30/16. We model debt + preferred to total assets to finish 2016 at 31.0% and 2017 at 27.4%, from 27.7% in 2Q16. We are adjusting our 2016 NII/share from $2.39 to $2.38 and our 2017 NII/share estimate from $2.61 to $2.64. Our $24 price target implies an estimated 2017 Price/Net Investment Income (P/ NII) of 9.1x, dividend yield of 10.0%, and Price/Net Asset Value (P/NAV) of 1.40x. “
A number of other analysts have also recently issued reports on the company. Zacks Investment Research cut Eagle Point Credit from a “buy” rating to a “hold” rating in a research report on Monday, July 25th. Deutsche Bank AG raised their price objective on Eagle Point Credit from $18.50 to $19.00 and gave the company a “buy” rating in a research report on Thursday, August 25th. Finally, Compass Point raised their price objective on Eagle Point Credit from $15.00 to $17.00 and gave the company a “neutral” rating in a research report on Thursday, August 25th. One analyst has rated the stock with a sell rating, two have issued a hold rating and three have issued a buy rating to the stock. The stock currently has a consensus rating of “Hold” and a consensus target price of C$19.25.
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Shares of Eagle Point Credit (NYSE:ECC) traded up 0.30% during mid-day trading on Monday, reaching $16.97. The company’s stock had a trading volume of 16,088 shares. Eagle Point Credit has a 52-week low of $13.30 and a 52-week high of $19.22. The firm has a 50 day moving average price of $17.42 and a 200 day moving average price of $17.10.
Eagle Point Credit (NYSE:ECC) last released its quarterly earnings data on Wednesday, August 24th. The investment management company reported $0.57 earnings per share (EPS) for the quarter, missing the Zacks’ consensus estimate of $0.59 by $0.02. On average, equities research analysts forecast that Eagle Point Credit will post $2.33 earnings per share for the current year.
The company also recently declared a quarterly dividend, which will be paid on Monday, October 31st. Investors of record on Friday, September 30th will be issued a dividend of $0.60 per share. The ex-dividend date is Wednesday, September 28th. This represents a $2.40 annualized dividend and a yield of 14.14%. Eagle Point Credit’s payout ratio is currently -120.60%.
In other news, CFO Kenneth P. Onorio purchased 1,696 shares of the company’s stock in a transaction that occurred on Thursday, September 1st. The stock was acquired at an average cost of C$17.75 per share, with a total value of C$30,104.00. The acquisition was disclosed in a document filed with the SEC, which is available at this hyperlink. Corporate insiders own 0.65% of the company’s stock.
Hedge funds have recently added to or reduced their stakes in the company. Bessemer Group Inc. boosted its position in shares of Eagle Point Credit by 54.1% in the first quarter. Bessemer Group Inc. now owns 8,427 shares of the investment management company’s stock valued at $139,000 after buying an additional 2,959 shares in the last quarter. Freestone Capital Holdings LLC bought a new position in shares of Eagle Point Credit during the second quarter valued at $2,174,000. Mycio Wealth Partners LLC boosted its position in shares of Eagle Point Credit by 0.5% in the second quarter. Mycio Wealth Partners LLC now owns 1,378,743 shares of the investment management company’s stock valued at $22,198,000 after buying an additional 6,590 shares in the last quarter. Bard Associates Inc. boosted its position in shares of Eagle Point Credit by 0.3% in the second quarter. Bard Associates Inc. now owns 112,704 shares of the investment management company’s stock valued at $1,815,000 after buying an additional 334 shares in the last quarter. Finally, National Asset Management Inc. bought a new position in shares of Eagle Point Credit during the second quarter valued at $261,000. 70.31% of the stock is owned by institutional investors and hedge funds.
About Eagle Point Credit
Eagle Point Credit Company Inc is a non-diversified, closed-end management investment company. The Company’s primary investment objective is to generate high current income, with a secondary objective to generate capital appreciation. The Company invests primarily in equity and junior debt tranches of collateralized loan obligations (CLOs).
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