Oppenheimer Remains a Buy on Great Elm Capital Corporation


Oppenheimer analyst Chris Kotowski maintained a Buy rating on Great Elm Capital Corporation (NASDAQ: GECC) today and set a price target of $12. The company’s shares opened today at $9.25.

Kotowski said:

“GECC reported net investment income (NII) of $0.36 versus our $0.34 estimate and is $0.11 more than its dividend. As we have highlighted in prior reports, the biggest near-term risk to GECC is the disposition of Avanti Communications, which accounted for 21% of debt investments. While the asset was marked down slightly in 1Q, there were actually significant positive developments at Avanti in recent months, which we describe inside. Since GECC became public, the average dividend coverage (NII/ dividend) was 1.53x compared to 1.46x in 1Q18. While the $43M baby bond issuance in January increased substantial liquidity to GECC, it only boosted the leverage ratio from 0.25x in 4Q17 to 0.63x in 1Q18. With the stock trading at 79% of NAV and earning a 10.7% dividend yield, compared to industry average of 87% and 11.0%, we believe the discount to industry average is unwarranted.”

According to TipRanks.com, Kotowski is a 5-star analyst with an average return of 10.1% and a 65.7% success rate. Kotowski covers the Financial sector, focusing on stocks such as Eagle Point Credit Company Inc, Apollo Global Management LLC, and Fidus Investment Corporation.

Great Elm Capital Corporation has an analyst consensus of Moderate Buy, with a price target consensus of $13.

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The company has a one-year high of $11.08 and a one-year low of $8.59. Currently, Great Elm Capital Corporation has an average volume of 13.44K.

Based on the recent corporate insider activity of 17 insiders, corporate insider sentiment is negative on the stock.

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Great Elm Capital Corp. a business development company that invests in smaller and lower middle-market companies located in the US. The fund targets companies operating in the fields of telecommunications, food and food distribution, business services, healthcare, marketing & data services, energy services, industrial, consumer products, media, alternative en

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