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Rand Capital Corp. (RAND)
NASDAQ:RAND
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Rand Capital
(NASDAQ:RAND)
68Neutral
Rand Capital (RAND) vs. S&P 500 (SPY)
Market Cap
$58.18M
Dividend Yield26.47%
Average Volume (3M)20.69K
Price to Earnings (P/E)5.6
Beta (1Y)0.50
Revenue Growth134.64%
EPS Growth35.26%
CountryUS
Employees4
SectorFinancial
Sector Strength81
IndustryAsset Management Services
Share Statistics
EPS (TTM)3.42
Shares Outstanding2,969,814
10 Day Avg. Volume13,751
30 Day Avg. Volume20,687
Financial Highlights & Ratios
PEG Ratio0.16
Price to Book (P/B)N/A
Price to Sales (P/S)4.79
Price to Cash Flow (P/CF)18.90
P/FCF Ratio17.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusModerate Buy
Number of Analyst Covering1
Rand Capital Business Overview & Revenue Model
Company DescriptionRand Capital Corporation is a business development company and regulated investment company specializing in private equity investments. The firm prefers to make investments through equity or debt instruments in lower middle market and in small to medium-sized privately held companies. It generally lends to more mature companies. The firm does not prefer to invest in real estate sector. It invests in companies that are engaged in the exploitation of new or unique products, technologies, or services. The firm invests in healthcare, consumer products, manufacturing, software, and professional services. It seeks to invest in companies based in the Western and Upstate New York region and its surrounding states with focus on Buffalo and Niagara region. The firm may invest in region within three to five hour drives from Western New York including Canada. It typically invests between $0.5 million and $1.5 million and the total investment in rounds is between $1 million and $5 million. The firm seeks to invest up to maximum of $3 million total per company as part of follow-on investments. It invest in startups and companies having annual revenue up to $10 million. It invest companies having EBITDA up to $5 million. The firm Follow-on investment(s) up to a targeted maximum of $2 million to $3 million total per company. The firm frequently participate three investment round. The firm seeks to be a lead investor in companies within its geographical area and participates in syndicate/co-invest with other investors outside it. It prefers to invest in businesses that are unique or possess proprietary right. The firm prefers to be a minority investor and seeks to take a Board seat in its portfolio companies. It typically holds its investments for a period of five to seven years. Rand Capital Corporation was founded in 1969 and is based in Buffalo, New York.
How the Company Makes MoneyRand Capital makes money primarily through the interest and dividends earned on its investment portfolio of debt and equity securities. The company generates revenue from the capital gains realized from the sale of these investments. Rand Capital strategically invests in companies with high growth potential, which allows it to benefit from the appreciation in the value of its investments. Additionally, the company may engage in partnerships with other investment firms or venture capitalists to co-invest in promising businesses, further enhancing its revenue potential. The performance of its investment portfolio, market conditions, and effective management of its investment strategies are significant factors contributing to its earnings.
Rand Capital Financial Statement Overview
Summary
Rand Capital exhibits strong financial stability with a high equity ratio and debt-free position. However, the income statement reveals volatility with inconsistent revenue growth and negative EBIT margins, indicating operational challenges. Positive signs include recent profitability and improved free cash flow.Income Statement
Rand Capital has shown significant volatility in its income statement metrics. The gross profit margin is consistently strong due to the nature of Asset Management, but net profit margin has been erratic, with recent profitability largely driven by non-operating income. Revenue growth has been inconsistent, peaking in 2023, then declining sharply in 2024, suggesting instability in revenue streams. EBIT margins have been negative in the most recent year, reflecting operational challenges.55
Neutral
Balance Sheet
The balance sheet of Rand Capital is relatively strong, with a high equity ratio indicating financial stability. The company has a debt-free position as of 2024, reducing financial risk. However, the return on equity has been inconsistent due to fluctuating net income, which could impact future returns.70
Positive
Cash Flow
Cash flow metrics reveal some improvements, with a positive shift in free cash flow in 2024. However, the operating cash flow to net income ratio was negative in prior years, indicating cash flow challenges. The company needs to stabilize its cash flows to ensure sustainable operations.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 295.26K | 7.34M | 5.77M | 20.79M | 3.04M | Gross Profit |
| 295.26K | 7.34M | -2.54M | 15.56M | 2.41M | EBIT |
| -463.20K | 4.20M | 10.61M | 15.60M | 2.07M | EBITDA |
| 0.00 | 8.25M | 0.00 | 85.11K | -399.70K | Net Income Common Stockholders |
| 3.43M | 6.53M | -881.85K | 15.80M | 743.77K |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 834.80K | 3.30M | 4.91M | 833.88K | 20.37M | Total Assets |
| 72.46M | 81.02M | 63.48M | 65.64M | 60.97M | Total Debt |
| 0.00 | 16.25M | 2.55M | 0.00 | 10.82M | Net Debt |
| -834.80K | 12.95M | 1.18M | -833.88K | -9.54M | Total Liabilities |
| 7.12M | 20.21M | 5.76M | 51.69K | 14.86M | Stockholders Equity |
| 65.33M | 60.82M | 57.72M | 60.75M | 46.10M |
| Cash Flow | Free Cash Flow | |||
| 15.33M | -8.34M | 252.37K | -3.94M | -616.97K | Operating Cash Flow |
| 15.33M | -8.34M | 252.37K | -3.94M | -616.97K | Investing Cash Flow |
| 0.00 | 0.00 | 3.54M | -10.32M | -6.71M | Financing Cash Flow |
| -17.79M | 10.27M | 282.75K | -15.59M | -4.83M |
Rand Capital Technical Analysis
Neutral
19.59
Price Trends
22.67
Negative
19.22
Positive
16.33
Positive
Market Momentum
-1.15
Positive
42.33
Neutral
17.56
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RAND, the sentiment is Neutral. The current price of 19.59 is below the 20-day moving average (MA) of 21.08, below the 50-day MA of 22.67, and above the 200-day MA of 16.33, indicating a neutral trend. The MACD of -1.15 indicates Positive momentum. The RSI at 42.33 is Neutral, neither overbought nor oversold. The STOCH value of 17.56 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for RAND.
Rand Capital Risk Analysis
Rand Capital disclosed 42 risk factors in its most recent earnings report. Rand Capital reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Rand Capital Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $15.30B | 9.11 | 12.40% | 8.64% | 19.95% | -10.57% | |
74 Outperform | $5.09B | 9.90 | 19.26% | 5.13% | 51.80% | 12.05% | |
68 Neutral | $58.18M | 5.56 | 14.00% | 26.47% | 134.64% | 35.26% | |
67 Neutral | $619.88M | 6.02 | 22.43% | 7.14% | 69.53% | 60.29% | |
67 Neutral | $3.39B | 12.06 | 13.71% | 8.24% | -1.49% | -29.48% | |
64 Neutral | $14.53B | 10.25 | 8.67% | 4.22% | 16.51% | -12.20% | |
63 Neutral | $1.86B | ― | 0.78% | 16.31% | -31.63% | -0.75% |
* Financial Sector Average
Performance Comparison
RAND
Rand Capital
19.59
8.84
82.23%
GLAD
Gladstone Capital
27.76
8.53
44.36%
HTGC
Hercules Capital
19.59
3.07
18.58%
MAIN
Main Street Capital
57.47
14.11
32.54%
PSEC
Prospect Capital
4.18
-0.64
-13.28%
ARCC
Ares Capital
22.36
3.74
20.09%
Rand Capital Earnings Call Summary
Earnings Call Date: Mar 10, 2025 | % Change Since: -9.93% | Next Earnings Date: May 12, 2025
Earnings Call Sentiment Positive
The earnings call highlighted significant growth in investment income, successful strategic monetization and portfolio shifts towards a more stable, income-generating structure. Despite facing a challenging economic environment and a decrease in overall portfolio value, the company demonstrated strong financial health and commitment to shareholder value through increased dividends and strategic debt reduction.Highlights
Strong Investment Income Growth
Total investment income rose 11% in the fourth quarter to $2.1 million and grew 17% for the full year to $8.6 million, driven by the focus on expanding the debt investment portfolio.
Increased Net Asset Value
Net asset value per share increased by 7% year-over-year, reaching $25.31 at year end.
Successful Portfolio Monetization
Generated approximately $27 million in cash proceeds from strategic monetization of equity investments, including the sale of SciAps.
Debt-Focused Portfolio Strategy
Shifted to a more income-generating portfolio, with debt investments now comprising 75% of the portfolio, up from 64% in 2023.
Dividend Increase
Regular quarterly cash dividend increased by 16% in the second quarter, with total dividends declared for the year reaching $5.03 per share.
Strategic Debt Reduction
Reduced outstanding bank debt by $15.7 million during the year, with $24 million available in credit facilities for future growth.
High Yield on Debt Investments
Annualized weighted average yield of debt investments was 13.8% as of December 31, 2024, an increase of 20 basis points over 2023.
Lowlights
Portfolio Value Decline
Portfolio fair value declined by 8% from the end of 2023, primarily due to the successful exits from SciAps and other stock sales.
Uncertain Economic Environment
Challenging economic and political environment with impacts on consumer spending habits affecting certain business operations.
Decrease in Number of Portfolio Companies
The number of portfolio companies decreased from 30 to 22 due to monetizing publicly traded stock holdings.
Company Guidance
In the fourth quarter of fiscal year 2024, Rand Capital Corporation reported a total investment income increase of 11%, reaching $2.1 million, with a full-year investment income of $8.6 million, up by 17% from the previous year. This growth was primarily driven by expanding their debt investment portfolio, which now makes up 75% of their $71 million portfolio, compared to 64% in 2023, yielding an annualized weighted average yield of 13.8%. Net asset value per share rose by 7% year-over-year to $25.31. Rand strategically monetized select equity investments, generating approximately $27 million in cash proceeds, which helped reduce outstanding bank debt by $15.7 million. They declared total dividends of $5.03 per share for the year, including a $4.20 per share dividend in Q4, influenced by the successful sale of SciAps. The company also announced a regular quarterly cash dividend of $0.29 per share for Q1 2025. With strong liquidity, over $24 million in available credit facilities, and a focus on income-generating assets, Rand is well-positioned for future growth, despite potential macroeconomic challenges.Rand Capital Corporate Events
Other
Rand Capital to Present Investor Slides in March 2025
Neutral
Mar 18, 2025
Rand Capital Corporation announced that it will present its investor presentation slides to analysts and investors starting March 18, 2025. These slides will be available on the company’s website but are not incorporated by reference into any registration statement or other documents filed under the Securities Act of 1933 or the Exchange Act.
DividendsBusiness Operations and StrategyFinancial Disclosures
Rand Capital Reports Strong 2024 Financial Results
Positive
Mar 10, 2025
Rand Capital reported strong financial results for 2024, with a 17% increase in investment income to $8.6 million, driven by an expanded debt investment portfolio. The company increased its regular quarterly cash dividend by 16% and declared total dividends of $5.03 per share. Rand’s strategic focus on debt investments, which now make up 75% of its portfolio, has improved yields and net interest income. The company reduced its outstanding bank debt by $15.7 million and invested nearly $14 million in income-generating investments, positioning itself for continued growth in 2025.
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.