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BlackRock TCP Capital Corp. (TCPC)
NASDAQ:TCPC
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BlackRock TCP Capital
(NASDAQ:TCPC)58Neutral
Positive Factors
Portfolio Marks
Major portfolio marks included a $4.2 million gain on Securus and a $3.6 million gain on Domo.
Negative Factors
Dividend
TCPC's dividend cut to $0.25 brings it closer to right size, but recent loss severity coupled with ample risk content keeps analysts at bay.
Financial Performance
Analysts expect top-line headwinds from new non-accruals and portfolio run off, which is likely to continue for a more conservative leverage profile.
BlackRock TCP Capital (TCPC) vs. S&P 500 (SPY)
Market Cap
$702.74M
Dividend Yield16.35%
Average Volume (3M)680.66K
Price to Earnings (P/E)―
Beta (1Y)0.70
Revenue Growth8.24%
EPS Growth-207.60%
CountryUS
Employees19,800
SectorFinancial
Sector Strength93
IndustryAsset Management Services
Share Statistics
EPS (TTM)-0.72
Shares Outstanding85,077,290
10 Day Avg. Volume1,019,907
30 Day Avg. Volume680,657
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)9.47
Price to Cash Flow (P/CF)2.50
P/FCF Ratio1.60
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$8.00Price Target Upside-3.15% Downside
Rating ConsensusModerate Sell
Number of Analyst Covering2
BlackRock TCP Capital Business Overview & Revenue Model
Company DescriptionBlackRock TCP Capital Corp. (TCPC) is a specialty finance company that primarily invests in senior secured loans to middle-market companies. It operates as a business development company (BDC) and is managed by Tennenbaum Capital Partners, LLC, a subsidiary of BlackRock, Inc. The company focuses on providing a stable and attractive yield to its investors through a diversified portfolio of debt instruments, with an emphasis on maintaining a high level of credit quality.
How the Company Makes MoneyBlackRock TCP Capital makes money by earning interest income on the loans it provides to middle-market companies. As a business development company, it raises capital from investors and deploys it into debt investments, primarily senior secured loans. The company generates revenue from the interest payments made by its borrowers, and it also seeks capital appreciation from the equity investments it occasionally makes. TCPC's earnings are driven by the spread between the interest income it receives and the cost of funds, as well as by the fees it earns for managing its portfolio. In addition, the company benefits from its affiliation with BlackRock, which provides access to extensive resources and expertise in asset management.
BlackRock TCP Capital Financial Statement Overview
Summary
BlackRock TCP Capital demonstrates strong financial growth with solid revenue and profit margins, supported by robust cash flow and a debt-free balance sheet. However, historical leverage issues and a decline in EBIT margin necessitate caution.Income Statement
The income statement shows a robust revenue growth rate of 23.96% from 2023 to 2024, indicating strong top-line expansion. The gross and net profit margins are healthy, reflecting effective cost management. However, the decline in EBIT margin from previous years suggests potential operational challenges.75
Positive
Balance Sheet
The balance sheet reveals strong equity growth, with a debt-free position in 2024 significantly improving financial stability. The equity ratio has improved, indicating a solid asset base. However, the previous years' high debt-to-equity ratio highlights historical leverage concerns.68
Positive
Cash Flow
The cash flow statement indicates impressive free cash flow growth, alongside a strong operating cash flow to net income ratio, emphasizing efficient cash generation. The high free cash flow to net income ratio further supports the company's financial health.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 259.44M | 209.33M | 181.00M | 165.11M | 172.10M | Gross Profit |
| 259.44M | 209.33M | 181.00M | 165.11M | 172.10M | EBIT |
| 132.28M | 154.61M | 127.80M | 113.53M | 124.46M | EBITDA |
| 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | Net Income Common Stockholders |
| -63.14M | 38.47M | -9.23M | 133.79M | 71.37M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 91.59M | 112.24M | 82.44M | 19.55M | 20.01M | Total Assets |
| 1.92B | 1.70B | 1.72B | 1.89B | 1.67B | Total Debt |
| 0.00 | 985.20M | 944.01M | 1.01B | 850.02M | Net Debt |
| -91.59M | 872.96M | 861.57M | 992.91M | 830.01M | Total Liabilities |
| 1.14B | 1.01B | 972.60M | 1.06B | 907.00M | Stockholders Equity |
| 785.12M | 687.60M | 746.75M | 829.46M | 764.99M |
| Cash Flow | Free Cash Flow | |||
| 293.12M | 92.45M | 203.95M | -82.61M | 122.33M | Operating Cash Flow |
| 293.12M | 92.45M | 203.95M | -82.61M | 122.33M | Investing Cash Flow |
| 0.00 | 0.00 | 151.05M | 31.88M | 31.88M | Financing Cash Flow |
| -313.77M | -62.65M | -141.07M | 82.15M | -147.17M |
BlackRock TCP Capital Technical Analysis
Negative
8.26
Price Trends
8.89
Negative
8.63
Negative
8.83
Negative
Market Momentum
-0.23
Positive
33.53
Neutral
18.49
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TCPC, the sentiment is Negative. The current price of 8.26 is below the 20-day moving average (MA) of 8.90, below the 50-day MA of 8.89, and below the 200-day MA of 8.83, indicating a bearish trend. The MACD of -0.23 indicates Positive momentum. The RSI at 33.53 is Neutral, neither overbought nor oversold. The STOCH value of 18.49 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TCPC.
BlackRock TCP Capital Risk Analysis
BlackRock TCP Capital disclosed 66 risk factors in its most recent earnings report. BlackRock TCP 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
BlackRock TCP 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 |
|---|---|---|---|---|---|---|---|
77 Outperform | $5.11B | 10.02 | 19.26% | 5.06% | 51.80% | 12.05% | |
76 Outperform | $15.07B | 9.43 | 12.40% | 8.34% | 19.95% | -10.57% | |
72 Outperform | $1.44B | 22.62 | 3.96% | 14.52% | -28.04% | -69.52% | |
65 Neutral | $1.93B | ― | 0.78% | 15.75% | -31.63% | -0.75% | |
64 Neutral | $14.34B | 10.61 | 9.28% | 4.07% | 18.04% | -9.54% | |
58 Neutral | $702.74M | ― | -8.57% | 16.35% | 8.24% | -207.60% | |
53 Neutral | $468.17M | 28.87 | 3.28% | 12.62% | ― | -66.59% |
* Financial Sector Average
Performance Comparison
TCPC
BlackRock TCP Capital
8.26
-1.00
-10.80%
MAIN
Main Street Capital
57.65
15.06
35.36%
PNNT
Pennantpark Investment
7.17
1.19
19.90%
PSEC
Prospect Capital
4.35
-0.53
-10.86%
ARCC
Ares Capital
22.45
3.54
18.72%
GSBD
Goldman Sachs BDC
12.24
-1.43
-10.46%
BlackRock TCP Capital Earnings Call Summary
Earnings Call Date: Feb 27, 2025 | % Change Since: -11.56% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a challenging quarter for BlackRock TCP Capital Corp, with significant markdowns and increased non-accruals affecting financial performance. However, management demonstrated a commitment to shareholder interests through fee waivers and special dividends, while maintaining a strong portfolio and strategic focus on the middle market.Highlights
Strong Portfolio Performance
91.2% of the portfolio was invested in senior secured loans, 94.5% of which were floating rate. The portfolio's weighted average effective yield was 12.4% at year-end.
Positive Investment Activities
During Q4, the company deployed $121 million into nine new and nine existing portfolio companies, focusing on the core middle market and emphasizing seniority in the capital structure.
Management Fee Waiver
The advisor voluntarily agreed to waive one-third of the base management fee for three quarters in 2025, supporting shareholder interests amid NAV declines.
Special Dividends Declared
A $0.04 special dividend for Q1 2025 was declared, with intentions to declare a special dividend of at least $0.02 in Q2 and Q3 of 2025.
Lowlights
Decline in Net Investment Income
Full year 2024 net investment income was $1.52 per share, down from $1.84 per share in 2023, primarily due to lower base rates and increased non-accruals.
Increased Non-Accruals
Non-accruals represented 5.6% of the portfolio at fair market value, up from 3.8% in the previous quarter, including new additions Renovo and InMoment.
Significant Investment Markdowns
The NAV per share decreased from $10.11 to $9.23, primarily due to markdowns in investments such as Razor, Securus, and Astra.
Dividend Reduction
The regular dividend was reduced to $0.25 per share for Q1 2025 due to recent financial performance and ongoing challenges.
Company Guidance
During the BlackRock TCP Capital Corp's Fourth Quarter and Year-End 2024 Earnings Conference Call, important guidance was provided regarding the company's financial performance and strategic actions moving forward. The company reported a full-year adjusted net investment income of $1.52 per share, down from $1.84 per share in 2023, with an annualized ROE of 14.5%, impacted by lower base rates and increased non-accruals. Non-accruals rose to 5.6% of the portfolio at fair market value from 3.8% the previous quarter, while NAV per share decreased to $9.23 from $10.11. The company also marked down positions in companies like Razor, Securus, and Astra, with Razor accounting for 70% of markdowns. To support shareholders, the board reduced the regular dividend to $0.25 per share for Q1 2025, declared a $0.04 special dividend for the same quarter, and the advisor agreed to waive one-third of the base management fee for three quarters beginning January 1, 2025. The portfolio's fair market value was approximately $1.8 billion, with 91.2% in senior secured loans, and the weighted average effective yield was 12.4%. The company continues to focus on maintaining a diverse and highly selective investment approach, emphasizing first lien loans and leveraging the broader BlackRock platform.BlackRock TCP Capital Corporate Events
DividendsFinancial Disclosures
BlackRock TCP Capital Announces Q4 2024 Financial Results
Positive
Feb 27, 2025
On February 27, 2025, BlackRock TCP Capital Corp. announced its financial results for the fourth quarter and year ended December 31, 2024, reporting a net investment income of $0.40 per share for the quarter. The company declared a regular dividend of $0.25 per share and a special dividend of $0.04 per share, payable on March 31, 2025. Additionally, the Adviser agreed to waive one-third of its base management fee for three quarters in 2025. Despite challenges such as higher non-accruals and lower base rates, the company remains optimistic about future prospects and plans to continue declaring special dividends in the upcoming quarters.
DividendsFinancial Disclosures
BlackRock TCP Capital Announces Q4 2024 Financial Results
Positive
Feb 27, 2025
On February 27, 2025, BlackRock TCP Capital Corp. announced its financial results for the fourth quarter and year ended December 31, 2024, reporting a net investment income of $0.40 per share for the quarter. The company declared a first quarter regular dividend of $0.25 per share and a special dividend of $0.04 per share, payable on March 31, 2025. Additionally, the Adviser agreed to waive one-third of its base management fee for three quarters starting January 1, 2025. Despite challenges such as higher non-accruals and lower base rates, the company remains optimistic about its future prospects and plans to declare further special dividends in 2025, subject to board approval.
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.