Market Overview

UPDATE: J.P. Morgan Initiates Fifth Street Finance with Overweight on Optimization Opportunity

Share:
Related FSC
Analyst: GE Capital Sale Stirs Pot For Business Development Companies
Fifth Street Arranges $171M One-Stop Financing Facility to LegalZoom Supporting the Company's Stock Purchase, Dividend Payment & Growth Plans
The MnM Portfolio, May 2015: Ep. 3 - Healing The Portfolio With Healthcare (Seeking Alpha)

In a report published Wednesday, J.P. Morgan analyst Richard Shane initiated coverage on Fifth Street Finance Corp. (NASDAQ: FSC) with an Overweight rating and $11.00 price target.

In the report, Shane noted, “FSC is one of five BDCs to have crossed the $1.5B asset threshold. We believe that as BDCs migrate from $1B to $2B in receivables, they begin to generate additional competitive advantages including: more consistent access to equity, lower borrowing costs, increased operating leverage, and greater transaction flexibility. In our view, FSC is at this inflection point, potentially creating a significant opportunity over the next 12 to 24 months. Through year-end, we expect the company to optimize leverage and that NII will fully cover the quarterly dividend. We view FSC's increasingly secure 10.6% dividend yield as attractive.”

Fifth Street Finance Corp. closed on Tuesday at $10.87.

Latest Ratings for FSC

DateFirmActionFromTo
Apr 2015UBSDowngradesBuyNeutral
Feb 2015Deutsche BankMaintainsBuy
Feb 2015Raymond JamesDowngradesOutperformMarket Perform

View More Analyst Ratings for FSC
View the Latest Analyst Ratings

Posted-In: J.P. MorganAnalyst Color Initiation Analyst Ratings

 

Related Articles (FSC)

Around the Web, We're Loving...

Get Benzinga's Newsletters