New Mountain Finance Corporation (NASDAQ:NMFC) Stock Rated "Reduce" by Wall Street Analysts

Key Points

• Analysts rate NMFC “Reduce”: Of five covering analysts, one recommends selling and four advise holding. The average 12-month price target is $7.67, with recent target cuts from Keefe, Bruyette & Woods and Wells Fargo.
• Shares are trading near their 52-week low: NMFC opened at $6.74, compared with a 52-week range of $6.67 to $9.84, and its 50-day and 200-day moving averages are $7.30 and $7.54.
• Dividend yield is high but financially pressured: The company reported quarterly EPS in line with estimates at $0.26, while revenue fell short of expectations. Its $0.25 quarterly dividend equates to a 14.8% yield, but the payout ratio is negative at -212.77%.

Shares of New Mountain Finance Corporation (NASDAQ:NMFC - Get Free Report) have been assigned a consensus recommendation of "Reduce" from the five analysts that are covering the firm, Marketbeat.com reports. One investment analyst has rated the stock with a sell rating and four have issued a hold rating on the company. The average 12-month price target among analysts that have issued ratings on the stock in the last year is $7.67.

NMFC has been the subject of a number of research analyst reports. Keefe, Bruyette & Woods decreased their target price on New Mountain Finance from $9.00 to $8.00 and set a "market perform" rating for the company in a research report on Monday, July 20th. Weiss Ratings downgraded New Mountain Finance from a "sell (d+)" rating to a "sell (d)" rating in a research report on Thursday. Finally, Wells Fargo & Company cut their price target on New Mountain Finance from $8.00 to $7.50 and set an "equal weight" rating on the stock in a research note on Wednesday, August 5th.

New Mountain Finance Stock Performance

New Mountain Finance stock opened at $6.74 on Tuesday. The company has a debt-to-equity ratio of 1.30, a quick ratio of 3.66 and a current ratio of 3.66. The company has a market capitalization of $636.59 million, a PE ratio of -14.34 and a beta of 0.60. The company has a 50 day moving average price of $7.30 and a 200-day moving average price of $7.54. New Mountain Finance has a fifty-two week low of $6.67 and a fifty-two week high of $9.84.

New Mountain Finance (NASDAQ:NMFC - Get Free Report) last announced its quarterly earnings data on Monday, August 3rd. The company reported $0.26 earnings per share (EPS) for the quarter, hitting the consensus estimate of $0.26. The company had revenue of $39.02 million for the quarter, compared to analysts' expectations of $62.78 million. New Mountain Finance had a positive return on equity of 10.94% and a negative net margin of 16.78%. During the same quarter in the prior year, the firm earned $0.32 earnings per share. As a group, equities analysts forecast that New Mountain Finance will post 1.10 earnings per share for the current year.

New Mountain Finance Dividend Announcement

The firm also recently disclosed a quarterly dividend, which was paid on Wednesday, September 30th. Investors of record on Wednesday, September 16th were paid a $0.25 dividend. The ex-dividend date of this dividend was Wednesday, September 16th. This represents a $1.00 dividend on an annualized basis and a yield of 14.8%. New Mountain Finance's dividend payout ratio is -212.77%.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently added to or reduced their stakes in the business. Corient Private Wealth LLC bought a new stake in shares of New Mountain Finance in the 4th quarter valued at about $7,450,000. Van ECK Associates Corp lifted its position in shares of New Mountain Finance by 19.4% in the 2nd quarter. Van ECK Associates Corp now owns 2,145,047 shares of the company's stock worth $15,380,000 after purchasing an additional 348,872 shares during the period. Corient Private Wealth LP boosted its stake in shares of New Mountain Finance by 29.2% during the second quarter. Corient Private Wealth LP now owns 1,125,657 shares of the company's stock valued at $8,071,000 after purchasing an additional 254,361 shares in the last quarter. Rivernorth Capital Management LLC bought a new position in shares of New Mountain Finance during the second quarter valued at approximately $1,008,000. Finally, Tranquility Partners LLC boosted its stake in shares of New Mountain Finance by 18.2% during the first quarter. Tranquility Partners LLC now owns 316,752 shares of the company's stock valued at $2,458,000 after purchasing an additional 48,679 shares in the last quarter. 32.08% of the stock is currently owned by institutional investors.

About New Mountain Finance

New Mountain Finance Corporation is a business development company (BDC) that provides financing to established middle-market companies. The company primarily invests in privately held businesses through senior secured loans, unitranche loans, subordinated debt and other debt securities, and may also make equity investments.

New Mountain Finance generally focuses on companies with strong market positions, recurring revenue and experienced management teams. Its investments span a range of industries and are intended to support acquisitions, recapitalizations, growth initiatives and other corporate purposes.

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