Oppenheimer analyst Chris Kotowski maintained a Hold rating on Garrison (GARS) today. The company’s shares opened today at $7.95, close to its 52-week low of $7.77.
Kotowski noted:
“GARS’s net investment income of $0.23 per share for 3Q18 missed our $0.31 expectation. Assets actually declined in the quarter, causing interest and other income to miss our expectation, while borrowing and other expenses were higher (Exhibit 1). It is a challenging environment, and GARS’s historical credit problems have led to a strategy more aimed at senior and thus lower yielding loans. This of course has lowered the overall earnings power of the portfolio, which led to a second cut to the quarterly dividend in the span of two years. This was by no means a surprise, and the stock isn’t reacting much. Although progress has been made on portfolio growth and reduction in borrowing costs, we’d prefer to see how 2019 earnings progress and thus remain on the sidelines.”
According to TipRanks.com, Kotowski is a 5-star analyst with an average return of 9.6% and a 61.0% success rate. Kotowski covers the Financial sector, focusing on stocks such as Eagle Point Credit Company Inc, Great Elm Capital Corporation, and Fidus Investment Corporation.
The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Garrison with a $12 average price target.
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Based on Garrison’s latest earnings release for the quarter ending September 30, the company reported a quarterly net profit of $1.49 million. In comparison, last year the company had a net profit of $4.42 million.
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Garrison Capital, Inc. operates as a externally managed, non-diversified closed-end investment fund. The firm’s investment objective is to generate current income and capital appreciation by making investments primarily in debt securities and loans of U.S. based middle-market companies.
