FS KKR Capital (NYSE:FSK) Hits New 52-Week Low - Should You Sell?

Key Points

• FS KKR Capital's shares have hit a new 52-week low at $16.94, dropping from a previous close of $17.54, with significant trading volume of over 3.7 million shares.
• Wells Fargo and Zacks have cut their price targets and ratings for the stock, with Wells Fargo lowering it to $15.00 and Zacks assigning a "strong sell" rating.
• The company announced an increase in its quarterly dividend from $0.64 to $0.70, reflecting a significant annual yield of 16.5%, despite a high dividend payout ratio of 328.21%.

FS KKR Capital Corp. (NYSE:FSK - Get Free Report) shares reached a new 52-week low on Tuesday . The company traded as low as $16.94 and last traded at $16.95, with a volume of 3789332 shares changing hands. The stock had previously closed at $17.54.

Analysts Set New Price Targets

A number of research firms have recently weighed in on FSK. Wells Fargo & Company reduced their price target on shares of FS KKR Capital from $18.00 to $15.00 and set an "underweight" rating on the stock in a research note on Friday, August 8th. Royal Bank Of Canada reduced their price target on shares of FS KKR Capital from $21.00 to $18.00 and set a "sector perform" rating on the stock in a research note on Tuesday, August 26th. Keefe, Bruyette & Woods dropped their price objective on shares of FS KKR Capital from $19.00 to $18.50 and set a "market perform" rating for the company in a report on Tuesday, August 12th. Zacks Research upgraded shares of FS KKR Capital to a "strong sell" rating in a report on Friday, August 8th. Finally, Wall Street Zen lowered shares of FS KKR Capital from a "hold" rating to a "sell" rating in a report on Saturday, August 9th. Five 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 has a consensus rating of "Reduce" and an average price target of $18.42.

FS KKR Capital Price Performance

The firm's 50-day moving average is $19.06 and its 200-day moving average is $20.10. The company has a debt-to-equity ratio of 1.31, a current ratio of 2.40 and a quick ratio of 2.40.

FS KKR Capital (NYSE:FSK - Get Free Report) last posted its quarterly earnings results on Wednesday, August 6th. The company reported ($0.60) earnings per share (EPS) for the quarter, missing the consensus estimate of $0.63 by ($1.23). FS KKR Capital had a net margin of 13.24% and a return on equity of 6.24%. The business had revenue of $398.00 million during the quarter, compared to analyst estimates of $402.00 million. During the same period in the previous year, the business posted $0.75 EPS. On average, sell-side analysts expect that FS KKR Capital Corp. will post 2.89 earnings per share for the current year.

FS KKR Capital Increases Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, October 2nd. Shareholders of record on Wednesday, September 17th will be issued a dividend of $0.70 per share. The ex-dividend date of this dividend is Wednesday, September 17th. This represents a $2.80 dividend on an annualized basis and a yield of 17.7%. This is a positive change from FS KKR Capital's previous quarterly dividend of $0.64. FS KKR Capital's payout ratio is presently 328.21%.

Hedge Funds Weigh In On FS KKR Capital

A number of hedge funds have recently bought and sold shares of FSK. CCLA Investment Management purchased a new position in FS KKR Capital during the 2nd quarter worth $33,463,000. Kingswood Wealth Advisors LLC boosted its holdings in FS KKR Capital by 250.9% during the 1st quarter. Kingswood Wealth Advisors LLC now owns 788,025 shares of the company's stock worth $16,831,000 after acquiring an additional 563,432 shares during the last quarter. SCS Capital Management LLC purchased a new position in FS KKR Capital during the 1st quarter worth $10,822,000. Generali Asset Management SPA SGR boosted its holdings in FS KKR Capital by 21.7% during the 2nd quarter. Generali Asset Management SPA SGR now owns 2,485,265 shares of the company's stock worth $51,569,000 after acquiring an additional 442,374 shares during the last quarter. Finally, Wellington Management Group LLP purchased a new position in FS KKR Capital during the 1st quarter worth $9,218,000. 36.26% of the stock is owned by hedge funds and other institutional investors.

About FS KKR Capital

FS KKR Capital Corp. is a business development company specializing in investments in debt securities. It provides customized credit solutions to private middle market U.S. companies. It invest primarily in the senior secured debt and, to a lesser extent, the subordinated debt of private middle market U.S.