Analyst Explains Why They CM Finance Upgrade Their CM Finance Rating


CM Finance (NASDAQ: CMFN) received a Buy rating and a $11 price target from Oppenheimer analyst Chris Kotowski today. The company’s shares opened today at $8.10.

Kotowski noted:

“When we upgraded CMFN in PT), we noted that our recommendation was a higher risk/higher return scenario because the company took some lumps during the energy downtown and because it has a concentrated portfolio of just 25 names. Our thesis remains the same, especially since we have another quarter of solid results. CMFN reported $0.27 in net investment income for 1Q18, ahead of both our $0.25 expectation and the $0.25 dividend. NAV has been stable here for 5+ quarters, yet the stock is trading at just 65% of book. While we think it may take some time to trade back to NAV, we see the current 12.4% dividend yield as stable and believe CMFN represents a favorable balance of risk and reward.”

According to TipRanks.com, Kotowski is a 5-star analyst with an average return of 10.0% and a 65.6% success rate. Kotowski covers the Financial sector, focusing on stocks such as Eagle Point Credit Company Inc, Great Elm Capital Corporation, and Apollo Global Management LLC.

CM Finance has an analyst consensus of Moderate Buy, with a price target consensus of $11.

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CM Finance’s market cap is currently $110.2M and has a P/E ratio of 5.88. The company has a Price to Book ratio of 0.64.

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CM Finance, Inc. operates as a closed-end and non-diversified management investment company, which engages in business development. Its investment objective is to maximize the total return to its stockholders in the form of current income and capital appreciation through debt and related equity investments.

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