National Securities upgraded shares of Golub Capital BDC (NASDAQ:GBDC) from a neutral rating to a buy rating in a report issued on Monday, Marketbeat.com reports. They currently have $21.00 target price on the investment management company’s stock, up from their prior target price of $19.00.
“• Golub posted core NII/share of $0.32/share for fiscal 1Q18, in-line with our estimate and the quarterly dividend. GBDC has covered its quarterly dividend every quarter on a core NI basis since fiscal 3Q15. As the company continues to deploy capital in an accretive manner at a measured pace, we expect dividend coverage to mildly improve going forward.
• Golub has one of the lowest base management fees of any publicly trade externally managed BDC, at 1.375% of gross assets less cash, and we think it’s possible for this to come down further as the private AUM of the business grows more.
• Golub’s platform remains one of the largest of any BDC at over $18 billion. The ability to co-invest, provide certainty of close, and be a partner with its borrowers only serves to improve quality, sponsor finance deal flow for the company. Additionally, it greatly mitigates concentration risk. On a $1.63 billion portfolio (excluding the SLF), the average investment size is a mere $8.6 million.
• This sound asset quality has led to minimal non-accruals, with non-accruals as a percentage of par averaging a mere 0.6% of the portfolio at par since fiscal 1Q13.
• GBDC has been extremely conservative with raising equity and has been mindful to raise “just-in-time capital”. GBDC has raised public equity in 7 quarters since fiscal 2Q14 with an average net raise of $37.8 million.
• Accordingly, we upgrading this best-in-class BDC to BUY from NEUTRAL and increasing our price target to $21 from $19. We are adjusting our fiscal 2018 core NII/share estimate to $1.28 from $1.27 and our fiscal 2019 core NII/share estimate to $1.30 from $1.29.,” National Securities’ analyst wrote.
Other analysts have also recently issued reports about the company. ValuEngine upgraded Golub Capital BDC from a hold rating to a buy rating in a research report on Saturday, December 9th. BidaskClub upgraded Golub Capital BDC from a sell rating to a hold rating in a research report on Monday, February 5th. Finally, Zacks Investment Research upgraded Golub Capital BDC from a strong sell rating to a hold rating in a research report on Wednesday, January 24th. Five investment analysts have rated the stock with a hold rating and two have assigned a buy rating to the company. The stock has a consensus rating of Hold and a consensus price target of $20.38.
Shares of Golub Capital BDC (NASDAQ GBDC) opened at $18.37 on Monday. The company has a debt-to-equity ratio of 0.86, a quick ratio of 3.46 and a current ratio of 3.46. Golub Capital BDC has a 12-month low of $17.35 and a 12-month high of $20.50. The company has a market capitalization of $1,090.00, a P/E ratio of 12.58, a P/E/G ratio of 1.44 and a beta of 0.65.
Golub Capital BDC (NASDAQ:GBDC) last issued its quarterly earnings results on Wednesday, February 7th. The investment management company reported $0.32 EPS for the quarter, hitting the Thomson Reuters’ consensus estimate of $0.32. Golub Capital BDC had a return on equity of 7.94% and a net margin of 58.64%. The firm had revenue of $36.45 million during the quarter, compared to analysts’ expectations of $35.22 million. During the same period in the previous year, the business earned $0.34 earnings per share. The firm’s revenue for the quarter was up 7.7% on a year-over-year basis. analysts predict that Golub Capital BDC will post 1.27 EPS for the current fiscal year.
The business also recently announced a quarterly dividend, which will be paid on Friday, March 30th. Shareholders of record on Thursday, March 8th will be issued a $0.32 dividend. This represents a $1.28 annualized dividend and a yield of 6.97%. The ex-dividend date is Wednesday, March 7th. Golub Capital BDC’s payout ratio is currently 65.75%.
In related news, Director William M. Iv Webster bought 1,634 shares of the company’s stock in a transaction on Monday, February 12th. The stock was bought at an average cost of $17.96 per share, for a total transaction of $29,346.64. Following the acquisition, the director now directly owns 138,148 shares in the company, valued at $2,481,138.08. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this link. 10.70% of the stock is owned by corporate insiders.
A number of large investors have recently modified their holdings of the business. Two Sigma Investments LP purchased a new stake in Golub Capital BDC in the 4th quarter valued at $2,352,000. Deutsche Bank AG grew its holdings in Golub Capital BDC by 6.1% in the 4th quarter. Deutsche Bank AG now owns 125,982 shares of the investment management company’s stock valued at $2,292,000 after buying an additional 7,249 shares in the last quarter. Thrivent Financial For Lutherans grew its holdings in Golub Capital BDC by 1.8% in the 4th quarter. Thrivent Financial For Lutherans now owns 310,736 shares of the investment management company’s stock valued at $5,655,000 after buying an additional 5,463 shares in the last quarter. Personal Resources Investment & Strategic Management Inc. purchased a new stake in Golub Capital BDC in the 4th quarter valued at $1,269,000. Finally, Citadel Advisors LLC purchased a new stake in Golub Capital BDC in the 4th quarter valued at $866,000. Institutional investors own 40.56% of the company’s stock.
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About Golub Capital BDC
Golub Capital BDC, Inc is an externally managed, non-diversified, closed-end, management investment company. The Company’s investment objective is to generate current income and capital appreciation by investing primarily in senior secured and one stop loans of the United States middle-market companies.
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