We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Hercules Capital (HTGC) Up on Q4 Earnings Beat, Revenue Rise
Read MoreHide Full Article
Shares of Hercules Capital Inc. (HTGC - Free Report) rose 2.8% in after-market trading following the release of its fourth-quarter and full-year 2022 results. The company’s quarterly net investment income of 47 cents per share surpassed the Zacks Consensus Estimate of 42 cents. The bottom line reflected a rise of 34.3% from the year-ago quarter.
Results were primarily aided by an increase in the total investment income. Also, the balance sheet position remained strong, and new commitments were robust. However, higher expenses hurt results to some extent.
Net investment income was $62.1 million, up 53.7% year over year. In 2022, net investment income was $188.1 million or $1.48 per share, up from $150 million or $1.29 per share in 2021.
Total Investment Income Improves, Expenses Rise
Quarterly total investment income was $100.2 million, up 38.3% from the year-ago quarter. The top line also beat the Zacks Consensus Estimate of $91.3 million.
In 2022, the total investment income of $321.7 million grew 14.5%. Also, the top line outpaced the consensus estimate of $312.8 million.
Total gross operating expenses increased 18.9% to $40 million. The rise was due to an increase in total employee compensation costs, general and administrative costs, interest expenses and loan fees.
Portfolio Value & New Commitments Solid
The fair value of Hercules Capital’s total investment portfolio was $2.96 billion as of Dec 31, 2022.
In the fourth quarter, the company delivered $645 million in gross new debt and equity commitments and $367.2 million in gross new funding. It realized early loan repayments of $130.9 million.
Balance Sheet Position Strong
As of Dec 31, 2022, Hercules Capital’s net asset value was $10.53 per share compared with $11.22 as of Dec 31, 2021.
As of Dec 31, 2022, the company had $606.8 million in liquidity, including $15.8 million of unrestricted cash and cash equivalents and $591 million in credit facilities.
At the end of the quarter, the weighted average cost of debt, comprising interest and fees, was 4.6%, down from 4.5% at the end of the prior-year quarter.
Our Take
Hercules Capital’s loan origination activity continues to be on track, which is likely to support top-line growth in the quarters ahead. However, as the company continues to undertake efforts to improve originations, expenses are expected to remain elevated.
Hercules Capital, Inc. Price, Consensus and EPS Surprise
FS KKR Capital Corp. (FSK - Free Report) is slated to announce quarterly numbers on Feb 27.
Over the past 30 days, the Zacks Consensus Estimate for FS KKR Capital’s quarterly earnings has been unchanged at 75 cents, implying a 15.4% rise from the prior-year reported number.
Horizon Technology Finance Corporation (HRZN - Free Report) is scheduled to announce quarterly numbers on Feb 28.
Over the past 30 days, the Zacks Consensus Estimate for Horizon Technology Finance has been unchanged at 37 cents. This indicates a fall of 5.1% from the prior-year quarter’s reported number.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Hercules Capital (HTGC) Up on Q4 Earnings Beat, Revenue Rise
Shares of Hercules Capital Inc. (HTGC - Free Report) rose 2.8% in after-market trading following the release of its fourth-quarter and full-year 2022 results. The company’s quarterly net investment income of 47 cents per share surpassed the Zacks Consensus Estimate of 42 cents. The bottom line reflected a rise of 34.3% from the year-ago quarter.
Results were primarily aided by an increase in the total investment income. Also, the balance sheet position remained strong, and new commitments were robust. However, higher expenses hurt results to some extent.
Net investment income was $62.1 million, up 53.7% year over year. In 2022, net investment income was $188.1 million or $1.48 per share, up from $150 million or $1.29 per share in 2021.
Total Investment Income Improves, Expenses Rise
Quarterly total investment income was $100.2 million, up 38.3% from the year-ago quarter. The top line also beat the Zacks Consensus Estimate of $91.3 million.
In 2022, the total investment income of $321.7 million grew 14.5%. Also, the top line outpaced the consensus estimate of $312.8 million.
Total gross operating expenses increased 18.9% to $40 million. The rise was due to an increase in total employee compensation costs, general and administrative costs, interest expenses and loan fees.
Portfolio Value & New Commitments Solid
The fair value of Hercules Capital’s total investment portfolio was $2.96 billion as of Dec 31, 2022.
In the fourth quarter, the company delivered $645 million in gross new debt and equity commitments and $367.2 million in gross new funding. It realized early loan repayments of $130.9 million.
Balance Sheet Position Strong
As of Dec 31, 2022, Hercules Capital’s net asset value was $10.53 per share compared with $11.22 as of Dec 31, 2021.
As of Dec 31, 2022, the company had $606.8 million in liquidity, including $15.8 million of unrestricted cash and cash equivalents and $591 million in credit facilities.
At the end of the quarter, the weighted average cost of debt, comprising interest and fees, was 4.6%, down from 4.5% at the end of the prior-year quarter.
Our Take
Hercules Capital’s loan origination activity continues to be on track, which is likely to support top-line growth in the quarters ahead. However, as the company continues to undertake efforts to improve originations, expenses are expected to remain elevated.
Hercules Capital, Inc. Price, Consensus and EPS Surprise
Hercules Capital, Inc. price-consensus-eps-surprise-chart | Hercules Capital, Inc. Quote
Currently, Hercules Capital carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
FS KKR Capital Corp. (FSK - Free Report) is slated to announce quarterly numbers on Feb 27.
Over the past 30 days, the Zacks Consensus Estimate for FS KKR Capital’s quarterly earnings has been unchanged at 75 cents, implying a 15.4% rise from the prior-year reported number.
Horizon Technology Finance Corporation (HRZN - Free Report) is scheduled to announce quarterly numbers on Feb 28.
Over the past 30 days, the Zacks Consensus Estimate for Horizon Technology Finance has been unchanged at 37 cents. This indicates a fall of 5.1% from the prior-year quarter’s reported number.