UPDATE: Oppenheimer Downgrades OFS Capital to Perform Following Weak 1Q Results

In a report published Thursday, Oppenheimer analyst Chris Kotowski downgraded the rating on OFS Capital Corp.

from Outperform to Perform, and removed the $16.00 price target. In the report, Kotowski noted, “We were drawn to OFS based on its large inside ownership (about 30%) and its 68% ownership in its Tamarix SBIC fund. Those reasons are still there but 1Q results were below our expectations and the deployment of capital at Tamarix is well below our expectations. In 1Q13 they had just $4M of deployments in the SBIC while we would have expected the quarterly run rate to be more in the $15-20M range. Between this and expenses running somewhat higher than expected, we are reducing our estimates as indicated, and as a result, our valuation model now gives us a $13.50-$14.00 fair value range.” OFS Capital Corp. closed on Wednesday at $13.66.