OFS Credit Company, Inc. (NASDAQ:OCCI) Announces $0.05 Monthly Dividend

Key Points

• OFS Credit declared a monthly dividend of $0.05 per share, payable on July 31 to shareholders of record on July 15, implying a very high annualized yield of 20.2%.
• Dividend sustainability is a concern: the company’s payout ratio is 158.1%, and analysts forecast $0.86 in EPS next year, suggesting the reported $1.36 annual dividend may not be coverable by earnings.
• Shares trade near $2.97 with a market cap of $86.4 million, and Wall Street Zen recently downgraded OFS Credit from a "buy" to a "hold."

OFS Credit Company, Inc. (NASDAQ:OCCI - Get Free Report) announced a monthly dividend on Thursday, April 16th. Investors of record on Wednesday, July 15th will be given a dividend of 0.05 per share on Friday, July 31st. This represents a c) dividend on an annualized basis and a dividend yield of 20.2%. The ex-dividend date of this dividend is Wednesday, July 15th.

OFS Credit has a dividend payout ratio of 158.1% indicating that the company cannot currently cover its dividend with earnings alone and is relying on its balance sheet to cover its dividend payments. Equities research analysts expect OFS Credit to earn $0.86 per share next year, which means the company may not be able to cover its $1.36 annual dividend with an expected future payout ratio of 158.1%.

OFS Credit Stock Down 0.3%

OCCI stock opened at $2.97 on Friday. OFS Credit has a fifty-two week low of $2.62 and a fifty-two week high of $6.82. The firm's 50-day simple moving average is $3.13 and its 200 day simple moving average is $4.28. The stock has a market cap of $86.40 million, a PE ratio of -2.27 and a beta of 0.61.

Wall Street Analysts Forecast Growth

Separately, Wall Street Zen lowered shares of OFS Credit from a "buy" rating to a "hold" rating in a research report on Saturday, January 31st.

OFS Credit Company Profile

OFS Credit Company, Inc NASDAQ: OCCI is a closed-end, externally managed business development company that primarily invests in senior secured loans to U.S. middle-market companies. As a registered investment company under the Investment Company Act of 1940, OFS Credit seeks to generate current income and capital appreciation by providing first-lien and second-lien debt financing to privately held and sponsor-backed businesses. The company targets borrowers with stable cash flows and defensible market positions across diverse industries, including business services, healthcare, manufacturing and technology.

The company's investment portfolio is weighted toward floating-rate loan instruments and subordinated debt, complemented by selective equity and equity-related securities.

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