Eagle Point Credit (NYSE:ECC – Get Free Report) announced its quarterly earnings data on Tuesday. The investment management company reported $0.20 EPS for the quarter, missing analysts’ consensus estimates of $0.23 by ($0.03), Zacks reports. Eagle Point Credit had a return on equity of 13.47% and a net margin of 12.33%.The company had revenue of $42.40 million for the quarter, compared to analysts’ expectations of $48.79 million.
Here are the key takeaways from Eagle Point Credit’s conference call:
- NAV fell sharply in Q1 to $4.17 per share from $5.70 at year-end, driving a GAAP net loss of $148 million and a negative 20.2% return on equity. Management said the decline was mainly due to broader CLO equity weakness and lower loan prices, especially in software-related credits.
- The company said April marked a strong rebound, with estimated NAV rising to $4.49-$4.59 per share, or about a 9% increase at the midpoint. Management attributed the recovery to improved credit sentiment and better performance across loans and CLO equity.
- Eagle Point deployed $100 million into new investments during the quarter at a weighted average effective yield of 18.9%. It also completed 4 CLO resets and 3 refinancings, saving 43 basis points on CLO debt costs and extending reinvestment periods.
- The portfolio remains heavily centered on CLO equity, but the company is expanding into complementary credit assets such as infrastructure credit, regulatory capital relief, and specialty credit. Management said these investments are meant to improve diversification and add attractive income opportunities.
- Management reiterated that the current quarterly distribution of $0.06 per share per month is intended to be sustainable and aligned with near-term earnings power. They also noted the company has fixed-rate, long-duration financing with no maturities before January 2029, which they view as a competitive advantage.
Eagle Point Credit Stock Up 1.4%
ECC stock opened at $4.08 on Thursday. The business has a fifty day moving average of $3.93 and a two-hundred day moving average of $4.92. The stock has a market cap of $538.76 million, a price-to-earnings ratio of 21.45 and a beta of 0.35. Eagle Point Credit has a 52-week low of $3.46 and a 52-week high of $7.99.
Eagle Point Credit Dividend Announcement
Wall Street Analysts Forecast Growth
A number of equities analysts recently commented on the company. LADENBURG THALM/SH SH downgraded Eagle Point Credit from a “buy” rating to a “neutral” rating in a research report on Monday, March 2nd. B. Riley Financial reduced their price objective on Eagle Point Credit from $7.00 to $4.25 and set a “buy” rating on the stock in a research report on Monday, March 16th. Credit Suisse Group set a $5.00 price objective on Eagle Point Credit in a research report on Wednesday, February 18th. Zacks Research upgraded Eagle Point Credit from a “strong sell” rating to a “hold” rating in a research report on Friday, May 1st. Finally, Alliance Global Partners reissued a “buy” rating on shares of Eagle Point Credit in a research note on Wednesday, April 15th. Three investment analysts have rated the stock with a Buy rating and three have issued a Hold rating to the company’s stock. Based on data from MarketBeat, the company has an average rating of “Moderate Buy” and an average target price of $6.67.
View Our Latest Research Report on Eagle Point Credit
Insider Transactions at Eagle Point Credit
In other Eagle Point Credit news, Portfolio Manager Daniel W. Ko bought 57,165 shares of the business’s stock in a transaction on Wednesday, March 18th. The stock was bought at an average price of $3.50 per share, with a total value of $200,077.50. Following the completion of the purchase, the portfolio manager directly owned 82,665 shares in the company, valued at $289,327.50. The trade was a 224.18% increase in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. 0.26% of the stock is currently owned by company insiders.
Institutional Investors Weigh In On Eagle Point Credit
Hedge funds and other institutional investors have recently added to or reduced their stakes in the business. Royal Bank of Canada grew its stake in shares of Eagle Point Credit by 135.5% in the fourth quarter. Royal Bank of Canada now owns 5,600 shares of the investment management company’s stock valued at $32,000 after buying an additional 3,222 shares in the last quarter. Geneos Wealth Management Inc. acquired a new stake in shares of Eagle Point Credit in the second quarter valued at $33,000. TCTC Holdings LLC grew its stake in shares of Eagle Point Credit by 45.5% in the fourth quarter. TCTC Holdings LLC now owns 8,000 shares of the investment management company’s stock valued at $46,000 after buying an additional 2,500 shares in the last quarter. Tower Research Capital LLC TRC acquired a new stake in shares of Eagle Point Credit in the second quarter valued at $65,000. Finally, Abel Hall LLC acquired a new stake in shares of Eagle Point Credit in the third quarter valued at $66,000. Institutional investors and hedge funds own 19.50% of the company’s stock.
Eagle Point Credit Company Profile
Eagle Point Credit Company is a closed-end, non-diversified management investment company that seeks to generate attractive risk-adjusted returns primarily through investments in collateralized loan obligations (CLOs) and related structured credit instruments. The firm is externally managed by Eagle Point Credit Management, LLC, a specialized credit asset manager focused on the structured credit markets. Eagle Point Credit Company’s shares trade on the New York Stock Exchange under the ticker symbol ECC.
The company’s investment strategy centers on acquiring both equity and debt tranches of actively managed CLOs alongside opportunistic positions in senior secured loans, high-yield bonds and credit derivatives.
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