Monroe Capital Q2 net investment income falls to $3.3 mln

Overview

• Monroe Capital Q2 net investment income falls to $3.3 mln, $0.15 per share

• Net asset value declines to $179.6 mln, $8.29 per share

• Co announces merger with Horizon Technology Finance, pending approvals

Outlook

• Monroe Capital expects merger with HRZN to unlock shareholder value

• Company anticipates merger synergies and operating leverage benefits

• Monroe Capital sees long-term upside from HRZN merger participation

Result Drivers

• NET INVESTMENT INCOME DECLINE - Decrease in net investment income due to lower average invested assets and effective rates

• NAV DECREASE - NAV fell due to net unrealized losses and dividends exceeding net investment income

• LEVERAGE REDUCTION - Debt-to-equity leverage decreased as proceeds from sales and paydowns reduced revolving credit facility balance

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 1 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the closed end funds peer group is "hold."

• Wall Street's median 12-month price target for Monroe Capital Corp is $8.25, about 17% above its August 8 closing price of $6.85

• The stock recently traded at 9 times the next 12-month earnings vs. a P/E of 7 three months ago

Press Release: ID:nGNX3t5MNG