Saba Capital Management L.P. Takes Position in FS KKR Capital Corp. $FSK

Key Points

• Saba Capital Management purchased 3.51 million shares of FS KKR Capital in the first quarter, valued at approximately $35.7 million, giving it a 1.25% stake and making FSK its 14th-largest portfolio holding.
• FSK reported quarterly EPS of $0.41, below the $0.44 analyst consensus, while revenue fell 24% year over year to $304 million. Analysts broadly rate the stock “Reduce,” with a consensus price target of $10.58.
• The company declared a quarterly dividend of $0.42, equivalent to $1.68 annually and a 15.5% yield; however, its payout ratio was negative 85.28%, reflecting recent losses.

Saba Capital Management L.P. purchased a new stake in FS KKR Capital Corp. (NYSE:FSK - Free Report) during the 1st quarter, according to its most recent 13F filing with the Securities & Exchange Commission. The institutional investor purchased 3,509,748 shares of the company's stock, valued at approximately $35,729,000. FS KKR Capital makes up approximately 1.0% of Saba Capital Management L.P.'s portfolio, making the stock its 14th largest holding. Saba Capital Management L.P. owned approximately 1.25% of FS KKR Capital as of its most recent filing with the Securities & Exchange Commission.

A number of other hedge funds have also bought and sold shares of FSK. Thurston Springer Miller Herd & Titak Inc. acquired a new position in shares of FS KKR Capital during the 4th quarter worth approximately $26,000. Jessup Wealth Management Inc bought a new position in shares of FS KKR Capital during the fourth quarter worth approximately $26,000. FNY Investment Advisers LLC acquired a new stake in shares of FS KKR Capital in the fourth quarter valued at approximately $28,000. Halbert Hargrove Global Advisors LLC acquired a new stake in shares of FS KKR Capital in the fourth quarter valued at approximately $31,000. Finally, Basepoint Wealth LLC bought a new stake in shares of FS KKR Capital in the fourth quarter valued at approximately $31,000. 36.26% of the stock is owned by institutional investors.

FS KKR Capital Stock Performance

NYSE FSK opened at $10.85 on Tuesday. The company has a current ratio of 2.00, a quick ratio of 2.00 and a debt-to-equity ratio of 1.38. The firm has a market capitalization of $3.04 billion, a price-to-earnings ratio of -5.51 and a beta of 0.82. The firm's 50 day simple moving average is $10.69 and its 200 day simple moving average is $11.45. FS KKR Capital Corp. has a 1 year low of $9.72 and a 1 year high of $22.25.

FS KKR Capital (NYSE:FSK - Get Free Report) last announced its quarterly earnings data on Monday, May 11th. The company reported $0.41 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $0.44 by ($0.03). FS KKR Capital had a negative net margin of 38.65% and a positive return on equity of 4.34%. The firm had revenue of $304.00 million during the quarter, compared to the consensus estimate of $316.81 million. During the same period last year, the business earned $0.65 earnings per share. The business's revenue was down 24.0% compared to the same quarter last year. As a group, research analysts expect that FS KKR Capital Corp. will post 1.64 earnings per share for the current fiscal year.

FS KKR Capital Announces Dividend

The firm also recently declared a quarterly dividend, which was paid on Thursday, July 2nd. Stockholders of record on Wednesday, June 17th were paid a $0.42 dividend. The ex-dividend date was Wednesday, June 17th. This represents a $1.68 annualized dividend and a dividend yield of 15.5%. FS KKR Capital's dividend payout ratio (DPR) is presently -85.28%.

Wall Street Analysts Forecast Growth

A number of equities research analysts recently issued reports on the company. Royal Bank Of Canada reissued a "sector perform" rating and set a $11.00 price target on shares of FS KKR Capital in a research report on Tuesday, May 12th. Weiss Ratings reaffirmed a "sell (d+)" rating on shares of FS KKR Capital in a report on Tuesday, June 2nd. Wells Fargo & Company cut their target price on FS KKR Capital from $11.00 to $10.00 and set an "equal weight" rating for the company in a research report on Tuesday, May 12th. Zacks Research cut FS KKR Capital from a "hold" rating to a "strong sell" rating in a research report on Monday, July 13th. Finally, Keefe, Bruyette & Woods dropped their price target on FS KKR Capital from $15.00 to $11.00 and set a "market perform" rating for the company in a research note on Thursday, April 16th. Six research analysts have rated the stock with a Hold rating and two have given a Sell rating to the company's stock. According to MarketBeat.com, the company currently has an average rating of "Reduce" and a consensus target price of $10.58.

FS KKR Capital Company Profile

FS KKR Capital Corp NYSE: FSK is a closed-end, externally managed business development company that primarily invests in private middle-market U.S. companies. The firm seeks to generate current income and capital appreciation by structuring investments in floating-rate senior secured loans, unitranche financings, second lien debt and mezzanine instruments. As a business development company, FSK provides financing solutions designed to support growth initiatives, acquisitions, leveraged buyouts and recapitalizations for privately held enterprises.

Established in 2018 through a strategic partnership between FS Investment Corporation and KKR Credit Advisors, a division of global investment firm KKR & Co Inc, FSK combines the credit underwriting capabilities of KKR’s global platform with FS’s expertise in private credit markets.

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