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Eagle Point Credit Company (ECC)
:ECC
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Eagle Point Credit Company
(NYSE:ECC)
71Outperform
Eagle Point Credit Company (ECC) vs. S&P 500 (SPY)
Market Cap
N/A
Dividend Yield20.87%
Average Volume (3M)1.31M
Price to Earnings (P/E)9.4
Beta (1Y)0.36
Revenue Growth22.24%
EPS Growth-50.71%
CountryUS
EmployeesN/A
SectorFinancial
Sector Strength81
IndustryAsset Management
Share Statistics
EPS (TTM)0.83
Shares Outstanding85,301,895
10 Day Avg. Volume1,424,062
30 Day Avg. Volume1,313,277
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
Price to Cash Flow (P/CF)N/A
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$10.00Price Target Upside24.22% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Eagle Point Credit Company Business Overview & Revenue Model
Company DescriptionEagle Point Credit Company Inc. (ECC) is a closed-end management investment company based in the United States. The company is focused on investing primarily in equity and junior debt tranches of collateralized loan obligations (CLOs), which are securitized pools of below investment-grade senior secured loans. ECC seeks to generate high current income and long-term capital appreciation for its shareholders through its diversified investment portfolio.
How the Company Makes MoneyEagle Point Credit Company makes money primarily through interest income and capital appreciation from its investments in CLO securities. The company earns revenue by collecting interest payments from the underlying loans within the CLO structures, as well as receiving distributions from the CLO equity tranches in which it invests. Additionally, ECC may benefit from capital gains when it sells its investments at higher prices than initially acquired. The company's performance and revenue are influenced by the credit performance of the underlying loans, economic conditions, and the overall CLO market dynamics. ECC's investment strategy is also supported by its partnerships with experienced CLO managers and financial institutions, which aid in selecting and managing its investment portfolio.
Eagle Point Credit Company Financial Statement Overview
Summary
Eagle Point Credit Company demonstrates strong profitability and financial stability with a robust equity position and no debt. However, challenges in revenue growth and cash flow management could pose risks. While the company shows resilience in maintaining profitability, addressing cash flow inefficiencies will be crucial for sustained growth and operational efficiency.Income Statement
Eagle Point Credit Company has shown significant improvement in its income statement over the years. The company's gross profit margin in the latest year is 100%, and the net profit margin is approximately 87.6%, indicating strong profitability. However, the revenue has decreased year-over-year compared to 2023, which was higher. The EBIT and EBITDA margins are not calculable for the latest year, which poses a challenge in assessing operational efficiency comprehensively.68
Positive
Balance Sheet
The balance sheet reflects a solid equity base with a high equity ratio of about 62.2%, indicating financial stability. The company has no debt, which reduces financial risk. However, the return on equity has decreased due to lower net income, presenting a potential area of concern for investors seeking high returns.75
Positive
Cash Flow
The cash flow statement shows challenges with negative operating cash flow, which could indicate operational inefficiencies. The free cash flow is also negative, signaling potential cash flow issues. Despite these, the company has managed to increase its financing cash flow significantly, which may support future liquidity needs.60
Neutral
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 160.40M | 97.61M | 139.07M | -92.73M | 140.84M | 64.06M | Gross Profit |
| 129.91M | 97.61M | 139.07M | -119.87M | 119.66M | 49.04M | EBIT |
| 168.15M | -207.66M | 101.15M | -87.68M | 131.86M | 60.89M | EBITDA |
| 82.85M | 0.00 | 132.38M | -87.68M | 0.00 | 0.00 | Net Income Common Stockholders |
| 121.42M | 85.49M | 116.89M | -101.81M | 131.86M | 60.89M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 1.52M | 42.22M | 46.45M | 56.83M | 13.92M | 4.76M | Total Assets |
| 476.71M | 1.51B | 954.49M | 760.15M | 768.04M | 512.59M | Total Debt |
| 95.01M | 0.00 | 157.71M | 150.77M | 140.69M | 92.80M | Net Debt |
| 93.50M | -42.22M | 111.27M | 93.94M | 126.78M | 88.04M | Total Liabilities |
| 189.59M | 568.58M | 218.72M | 260.89M | 241.85M | 150.93M | Stockholders Equity |
| 287.13M | 936.87M | 735.78M | 499.27M | 526.19M | 361.66M |
| Cash Flow | Free Cash Flow | ||||
| -5.22M | -429.00M | -81.57M | -74.97M | -114.71M | 1.22M | Operating Cash Flow |
| -5.22M | -429.00M | -81.57M | -74.97M | -114.71M | 1.22M | Investing Cash Flow |
| -216.95M | 0.00 | 0.00 | -132.01M | -157.48M | 22.72K | Financing Cash Flow |
| 266.91M | 424.38M | 71.33M | 117.87M | 123.94M | -29.46M |
Eagle Point Credit Company Technical Analysis
Negative
8.05
Price Trends
8.42
Negative
8.52
Negative
8.67
Negative
Market Momentum
-0.14
Negative
41.05
Neutral
78.05
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ECC, the sentiment is Negative. The current price of 8.05 is below the 20-day moving average (MA) of 8.22, below the 50-day MA of 8.42, and below the 200-day MA of 8.67, indicating a bearish trend. The MACD of -0.14 indicates Negative momentum. The RSI at 41.05 is Neutral, neither overbought nor oversold. The STOCH value of 78.05 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ECC.
Eagle Point Credit Company Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $935.61M | 9.77 | 9.67% | 9.56% | 14.33% | 25.35% | |
71 Outperform | 9.36 | 8.94% | 20.87% | 22.24% | -50.71% | ||
64 Neutral | $14.24B | 10.27 | 8.97% | 4.33% | 16.38% | -11.94% | |
63 Neutral | $1.86B | ― | 0.78% | 16.77% | -31.63% | -0.75% | |
61 Neutral | 6.88 | 10.11% | 20.76% | ― | ― | ||
54 Neutral | 5.74 | 14.24% | 21.29% | 38.75% | 22.73% | ||
53 Neutral | $460.99M | 28.27 | 3.28% | 12.89% | ― | -66.59% |
* Financial Sector Average
Performance Comparison
ECC
Eagle Point Credit Company
8.05
-0.33
-3.94%
PNNT
Pennantpark Investment
7.06
1.12
18.86%
PSEC
Prospect Capital
4.12
-0.70
-14.52%
SLRC
SLR Investment Corp.
17.15
3.44
25.09%
OCCI
OFS Credit Company
6.19
0.32
5.45%
OXLC
Oxford Lane Capital
4.65
0.51
12.32%
Eagle Point Credit Company Earnings Call Summary
Earnings Call Date: Feb 20, 2025 | % Change Since: -5.29% | Next Earnings Date: May 27, 2025
Earnings Call Sentiment Positive
The earnings call presented several positive aspects including a notable increase in total return for common stockholders and a successful capital deployment strategy. However, the call also highlighted some challenges such as realized losses and increased leverage. Despite these challenges, the positive aspects were more emphasized.Highlights
Total Return for Common Stockholders
For the year, holders of common stock had a total return of 14.7%, assuming reinvestment of their distribution.
Increase in Recurring Cash Flows
Recurring cash flows from the portfolio were $82 million, or $0.74 per share, exceeding quarterly aggregate common distributions and total expenses, up from $68.2 million, or $0.66 per share in the previous quarter.
Successful Capital Deployment
Over $223 million in net capital was deployed into new investments during the fourth quarter, with new CLO equity purchased having a weighted average effective yield of 17.8%.
Record CLO Issuance
A record $202 billion of new CLO issuance for the full year, exceeding the previous record of $187 billion set in 2021.
Lowlights
Realized Losses
The company generated net investment income, less realized losses of $0.12 per share, impacted by a $0.14 per share reclassification of unrealized losses related to 8 older CLO equity positions.
Increased Leverage
The company's debt and preferred securities outstanding at quarter-end totaled approximately 38% of the company's total assets, slightly above the target range.
Company Guidance
During the fourth quarter of 2024, Eagle Point Credit Company Inc. reported a solid performance with a total return of 14.7% for common stockholders, assuming reinvestment of distributions. The company achieved a GAAP return on equity of 10.1% and distributed $1.92 per common share over the year. Recurring cash flows from the portfolio reached $82 million, or $0.74 per share, surpassing the quarterly aggregate common distributions and total expenses. Net investment income, less realized losses, amounted to $0.12 per share, with $0.24 of net investment income per share offset by $0.12 of realized losses. Additionally, the company completed 16 resets, lengthening the portfolio's weighted average remaining reinvestment period to 3.4 years, which is over 50% above the market average. The company deployed over $223 million in net capital into new investments, with new CLO equity purchases having a weighted average effective yield of 17.8%. Eagle Point also issued $111 million in net proceeds from its largest-ever notes offering and raised the target leverage ratio to 27.5% to 37.5%. The company's asset coverage ratios for preferred stock and debt stood at 263% and 506%, respectively, comfortably above statutory requirements.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.