New Mountain Finance Corporation (NASDAQ:NMFC) Receives Average Recommendation of "Reduce" from Brokerages

Key Points

• Broker sentiment is cautious: New Mountain Finance has an average analyst rating of "Reduce" from seven covering firms, with one sell and six hold ratings. The average 1-year price target is $9.25.
• Dividend remains very high: The company declared a quarterly dividend of $0.25 per share, or $1.00 annualized, implying a 12.4% yield. However, the payout ratio is negative at -220.69%.
• Latest earnings were mixed: NMFC matched EPS expectations at $0.32, but revenue of $41.27 million fell short of forecasts and declined 19.7% year over year. Analysts currently expect full-year EPS of 1.11.

Shares of New Mountain Finance Corporation (NASDAQ:NMFC - Get Free Report) have received an average recommendation of "Reduce" from the seven ratings firms that are presently covering the firm, Marketbeat Ratings reports. One equities research analyst has rated the stock with a sell recommendation and six have given a hold recommendation to the company. The average 1-year price target among brokers that have updated their coverage on the stock in the last year is $9.25.

A number of brokerages have commented on NMFC. Zacks Research raised shares of New Mountain Finance from a "strong sell" rating to a "hold" rating in a research report on Wednesday, May 6th. B. Riley Financial cut their price target on shares of New Mountain Finance from $10.00 to $7.50 and set a "neutral" rating on the stock in a research report on Tuesday, March 3rd. Wells Fargo & Company cut their price target on shares of New Mountain Finance from $10.00 to $8.00 and set an "equal weight" rating on the stock in a research report on Thursday, February 26th. Keefe, Bruyette & Woods cut their price target on shares of New Mountain Finance from $10.00 to $9.00 and set a "market perform" rating on the stock in a research report on Wednesday, March 4th. Finally, Wall Street Zen raised shares of New Mountain Finance from a "sell" rating to a "hold" rating in a research report on Sunday, April 5th.

Insider Transactions at New Mountain Finance

In related news, COO Laura C. Holson Boswerger acquired 12,500 shares of the business's stock in a transaction dated Friday, February 27th. The shares were bought at an average price of $7.74 per share, with a total value of $96,750.00. Following the transaction, the chief operating officer directly owned 81,030 shares of the company's stock, valued at $627,172.20. This trade represents a 18.24% increase in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which can be accessed through the SEC website. Also, EVP Adam B. Weinstein acquired 12,900 shares of the business's stock in a transaction dated Tuesday, March 17th. The shares were bought at an average cost of $7.61 per share, for a total transaction of $98,169.00. Following the transaction, the executive vice president directly owned 751,756 shares in the company, valued at approximately $5,720,863.16. This represents a 1.75% increase in their ownership of the stock. Additional details regarding this purchase are available in the official SEC disclosure. Insiders have purchased 1,200,673 shares of company stock valued at $9,662,634 in the last 90 days. 14.90% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On New Mountain Finance

Institutional investors and hedge funds have recently made changes to their positions in the stock. State of Alaska Department of Revenue bought a new position in shares of New Mountain Finance during the 3rd quarter worth about $47,000. US Bancorp DE bought a new position in shares of New Mountain Finance during the 3rd quarter worth about $48,000. Advisory Services Network LLC bought a new position in shares of New Mountain Finance during the 3rd quarter worth about $65,000. Sound Income Strategies LLC boosted its position in shares of New Mountain Finance by 699.5% during the 4th quarter. Sound Income Strategies LLC now owns 7,683 shares of the company's stock worth $70,000 after purchasing an additional 6,722 shares in the last quarter. Finally, State of Wyoming acquired a new stake in shares of New Mountain Finance in the 1st quarter worth about $71,000. Institutional investors own 32.08% of the company's stock.

New Mountain Finance Stock Performance

Shares of NMFC opened at $8.09 on Friday. The company has a current ratio of 2.02, a quick ratio of 2.02 and a debt-to-equity ratio of 1.26. The stock has a market capitalization of $764.10 million, a P/E ratio of -13.95 and a beta of 0.57. The firm's fifty day simple moving average is $8.05 and its two-hundred day simple moving average is $8.70. New Mountain Finance has a 12 month low of $7.47 and a 12 month high of $11.04.

New Mountain Finance (NASDAQ:NMFC - Get Free Report) last issued its quarterly earnings results on Monday, May 4th. The company reported $0.32 EPS for the quarter, meeting analysts' consensus estimates of $0.32. The business had revenue of $41.27 million for the quarter, compared to analysts' expectations of $67.76 million. New Mountain Finance had a negative net margin of 18.65% and a positive return on equity of 11.14%. The business's quarterly revenue was down 19.7% compared to the same quarter last year. During the same quarter in the prior year, the firm posted $0.32 earnings per share. As a group, analysts predict that New Mountain Finance will post 1.11 EPS for the current year.

New Mountain Finance Cuts Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Tuesday, June 30th. Stockholders of record on Tuesday, June 16th will be given a dividend of $0.25 per share. This represents a $1.00 dividend on an annualized basis and a dividend yield of 12.4%. The ex-dividend date of this dividend is Tuesday, June 16th. New Mountain Finance's dividend payout ratio is -220.69%.

About New Mountain Finance

New Mountain Finance Corp. is a closed-end, externally managed business development company (BDC) that provides customized debt and equity capital solutions to U.S. middle-market companies. As a BDC organized under the Investment Company Act of 1940, New Mountain Finance invests in sponsor-backed and founder-led businesses that span a range of industry sectors, with a focus on companies demonstrating resilient growth and recurring revenue streams.

The company's investment portfolio typically includes first-lien senior secured loans, second-lien and junior debt instruments, mezzanine financing and equity co-investments.

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