In a report released yesterday, Finian O’Shea from Wells Fargo maintained a Sell rating on SLR Investment Corp. (SLRC – Research Report), with a price target of $13.00.
Finian O’Shea has given his Sell rating due to a combination of factors affecting SLR Investment Corp. The company’s recent earnings report showed a slight miss in net operating income, coming in at $0.44 compared to the expected $0.45. This shortfall was attributed to the ongoing runoff in cash flow and life sciences portfolios, which was only partially offset by growth in specialty finance joint ventures.
Moreover, there were mixed signals regarding the overall earnings trajectory of the portfolio, with sponsor finance runoff and a significant drop in Crystal’s portfolio size. Additionally, concerns were raised about revenue concentration, as two customers accounted for a quarter of KBH’s revenue, and one customer was involved in bankruptcy proceedings. Despite some growth in specific areas like SLR Business Credit and SLR Healthcare ABL, the company’s debt maturity schedule and ongoing losses in SLR Equipment Finance contributed to a cautious outlook, justifying the Sell rating.
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