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PhenixFIN (PFX) Stock Gains 2.8% as Q1 Earnings Rise Y/Y

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Shares of PhenixFIN Corporation’s (PFX - Free Report) have rallied 2.8% since the announcement of its first-quarter fiscal 2021 (ended Dec 31) results earlier this week. The company’s net investment income was $3.06 per share. This compares favorably with the Zacks Consensus Estimate of a loss of 16 cents and the prior-year quarter’s net investment income of $1.13.

Results reflect improvement in total investment income and business restructuring efforts undertaken during the quarter. However, slight rise in expenses was a headwind.

Net investment income was $8.3 million, up substantially from $3.1 million recorded in the prior-year quarter.

Total Investment Income & Expenses Rise

Total investment income was $12.8 million, jumping 70.9% year over year. Higher dividend income was the primary reason for the increase.

Total expenses, net of expense support reimbursement, rose 1.2% to $4.5 million.

Decent Balance Sheet Position

As of Dec 31, 2020, the company’s cash and cash equivalents (including restricted cash) totaled $62.4 million, up from $56.5 million on Sep 30, 2020.

Further, as of Dec 31, 2020, PhenixFIN had $77.8 million outstanding in aggregate principal amount of 6.125% unsecured notes due 2023.

PhenixFIN’s total assets amounted to $224 million, down from $306.1 million on Sep 30, 2020.

Net asset value was $52.94 per share, down from $55.30 sequentially.

Modest Portfolio Activity

The fair value of PhenixFIN’s total investment portfolio was $159.5 million as of Dec 31, 2020. The company had investments in securities of 37 portfolio companies.

As of Dec 31, 2020, PhenixFIN had nine portfolio company investments on non-accrual status.

Major Developments During the Quarter

In October 2020, PhenixFIN approved the sale of the MCC JV facility. This subsequently led the company to redeem $74 million 6.5% notes due January 2021.

Further, in November, the board of directors approved the adoption of an internalized management structure, which became effective Jan 1, 2021, and replaced the externalized management structure.

Our Take

Continued decent origination volumes are expected to aid PhenixFIN’s financials. However, slow economic recovery and lower interest rates remain key concerns.

PhenixFIN Corporation Price, Consensus and EPS Surprise

PhenixFIN Corporation Price, Consensus and EPS Surprise

PhenixFIN Corporation price-consensus-eps-surprise-chart | PhenixFIN Corporation Quote

Currently, PhenixFIN carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


Earnings Dates of Other Finance Stocks

Hercules Capital Inc. (HTGC - Free Report) is slated to announce quarterly numbers on Feb 23, while Horizon Technology Finance Corporation (HRZN - Free Report) and TriplePoint Venture Growth BDC Corp. (TPVG - Free Report) will release results on Mar 2 and Mar 3, respectively.

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