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Owl Rock Capital's (ORCC) Q3 Earnings Miss Mark, Decline Y/Y

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Owl Rock Capital Corporation’s (ORCC - Free Report) third-quarter 2020 earnings per share of 33 cents missed the Zacks Consensus Estimate and also decreased year over year by 8.3%.

This downside was mainly due to the COVID-19-led turmoil in the financial markets, higher expenses and lower investment income.

Quarter in Detail

In the quarter, the company’s total investment income was $187.1 million, down 0.6% year over year. This downside was mainly due to a decline in its portfolio's weighted average yield at amortized cost. However, this was partly offset by an upside in the investment portfolio.

New investment commitments were $843.6 million, down 45.3% year over year.

The company concluded the third quarter with investments in 110 portfolio companies with an aggregate fair value of $9.2 billion. As of Sep 30, 2020, the average investment size in each portfolio company was $90.2 million based on fair value.

Total operating expenses of $101.3 million rose 24.1% year over year due to higher management fees, performance-based incentive fees and professional fees, interest expenses, etc.

Dividend Update

The company declared a fourth-quarter dividend of 31 cents per share and had previously cleared a special dividend of 8 cents for its stockholders of record as of Dec 31, 2020. The amount will be paid out on or before Jan 19, 2021.

Financial Update

As of Sep 30, 2020, the company’s interest expenses of $37 million increased 27% year over year due to a rise in average daily borrowings.

As of Sep 30, 2020, the company had cash and restricted cash worth $0.2 billion, an amount of $4.3 billion as total principal value of debt outstanding and $1.4 billion of undrawn capacity under credit facilities.

As of Sep 30, 2020, the company had total assets worth $10.2 billion, up 11.2% from the level at 2019 end.

It ended the third quarter with $4.3 billion debt, up 41.7% from the level at last-year end.

Zacks Rank & Peer Releases

Owl Rock Capital currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Of the other companies in the finance sector that already reported third-quarter earnings, the bottom-line results of Visa Inc. (V - Free Report) beat the respective Zacks Consensus Estimate while that of Synchrony Financial (SYF - Free Report) and American Express Company (AXP - Free Report) missed the same.

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