With over a decade of experience in venture debt, Hercules is uniquely positioned to quickly create innovative financing solutions that perfectly fit within a company’s existing capital structure and map to its business objectives. Recognized as the industry leader, Hercules understands the flexibility these types of companies need and has the experience to work closely with them, even through challenging times, to help them reach critical milestones.
Its deep sector expertise, geographic presence and strong capital base have made Hercules the lender of choice for more than 480 innovative companies.
This stock comes with a $9.51% dividend. Jefferies has a $20 price target. The consensus target is lower at $18.44, and the shares closed at $14.85 on Wednesday.
Oaktree Specialty Lending
This lower-priced BDC stock offers investors the ability to buy more shares. Oaktree Specialty Lending Corp. (NASDAQ: OCSL) specializes in investments in middle-market, bridge financing, first and second lien debt financing, mezzanine debt, senior and junior secured debt, expansions, sponsor-led acquisitions, and management buyouts in small and midsized companies.
The fund seeks to invest in education services, business services, retail and consumer, health care, manufacturing, food and restaurants, construction and engineering, and media and advertising sectors. It invests between $5 million to $75 million principally in the form of one-stop, first lien and second lien debt investments, which may include an equity co-investment component in companies with enterprise value between $20 million and $150 million and EBITDA between $3 million and $50 million. The fund has a hold size of up to $75 million and may underwrite transactions up to $100 million. It primarily invests in North America, and the fund seeks to be a lead investor in its portfolio companies.
Investors receive a 9.70% dividend. The Jefferies price target is $8.50. The consensus target was last seen at $8.07. Wednesday’s final print was $7.06 per share.
While the Jefferies price targets are not sky high, combined with the strong dividends, the total return possibilities for all the stocks look to be very solid. Given the sector also has been somewhat out of favor this year, the risk/reward also looks compelling, especially given the strong results that all six of the companies have reported so far.
Originally posted at 24/7 Wall St.
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