New Mountain Finance (NASDAQ:NMFC) Shares Cross Above Fifty Day Moving Average - Should You Sell?

Key Points

• New Mountain Finance shares rose 1.1% and moved above their 50-day moving average, trading as high as $7.16 versus a 50-day average of $7.05.
• Analysts remain cautious: four rate the stock Hold and one rates it Sell, giving NMFC an overall “Reduce” rating and an average price target of $7.67. Several firms recently lowered their targets.
• Quarterly EPS of $0.26 matched estimates, but revenue fell 25% year over year to $60.41 million, while the company reported a negative net margin of 16.78%.

Shares of New Mountain Finance Corporation (NASDAQ:NMFC - Get Free Report) crossed above its 50-day moving average during trading on Monday. The stock has a 50-day moving average of $7.05 and traded as high as $7.16. New Mountain Finance shares last traded at $7.11, with a volume of 885,200 shares changing hands.

Analyst Ratings Changes

NMFC has been the topic of a number of recent analyst reports. Weiss Ratings cut New Mountain Finance from a "sell (d+)" rating to a "sell (d)" rating in a report on Thursday, October 8th. Keefe, Bruyette & Woods cut 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 note on Monday, July 20th. Finally, Wells Fargo & Company reduced their target price on New Mountain Finance from $8.00 to $7.50 and set an "equal weight" rating on the stock in a research report on Wednesday, August 5th. Four analysts have rated the stock with a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat, the stock presently has an average rating of "Reduce" and an average price target of $7.67.

New Mountain Finance Trading Up 1.1%

The company has a debt-to-equity ratio of 1.30, a current ratio of 3.66 and a quick ratio of 3.66. The company has a market cap of $671.54 million, a PE ratio of -15.13 and a beta of 0.60. The company's 50 day simple moving average is $7.05 and its two-hundred day simple moving average is $7.66.

New Mountain Finance (NASDAQ:NMFC - Get Free Report) last released its quarterly earnings results on Monday, November 2nd. The company reported $0.26 earnings per share (EPS) for the quarter, meeting analysts' consensus estimates of $0.26. New Mountain Finance had a negative net margin of 16.78% and a positive return on equity of 10.94%. The business had revenue of $60.41 million for the quarter, compared to the consensus estimate of $61.07 million. During the same period in the previous year, the firm earned $0.32 EPS. The business's revenue was down 25.0% on a year-over-year basis. As a group, sell-side analysts anticipate that New Mountain Finance Corporation will post 1.10 EPS for the current fiscal year.

Institutional Trading of New Mountain Finance

A number of institutional investors and hedge funds have recently added to or reduced their stakes in the company. GraniteShares Advisors LLC lifted its position in shares of New Mountain Finance by 27.7% during the third quarter. GraniteShares Advisors LLC now owns 387,410 shares of the company's stock worth $2,681,000 after purchasing an additional 84,083 shares in the last quarter. SMH Capital Advisors Inc. acquired a new position in shares of New Mountain Finance during the third quarter worth $174,000. State of Wyoming acquired a new position in shares of New Mountain Finance during the 3rd quarter worth about $338,000. International Assets Investment Management LLC increased its stake in New Mountain Finance by 60.8% in the third quarter. International Assets Investment Management LLC now owns 50,000 shares of the company's stock valued at $346,000 after purchasing an additional 18,902 shares during the last quarter. Finally, Genesee Capital Advisors LLC grew its position in shares of New Mountain Finance by 22.5% in the 3rd quarter. Genesee Capital Advisors LLC now owns 20,141 shares of the company's stock valued at $139,000 after buying an additional 3,694 shares during the last quarter. Hedge funds and other institutional investors own 32.08% of the company's stock.

New Mountain Finance Company Profile

New Mountain Finance Corporation NASDAQ: NMFC is a business development company that provides financing to middle-market businesses. The company is externally managed by New Mountain Finance Advisers, an affiliate of New Mountain Capital, an investment firm focused on growth-oriented companies in industries such as business services, healthcare, software and technology.

New Mountain Finance primarily invests in debt securities, including first-lien, unitranche, second-lien and unsecured loans.

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