TriplePoint (TPVG) Q4 Earnings Beat Estimates, Costs Rise

TriplePoint Venture Growth BDC Corp.’s (NYSE:TPVG) fourth-quarter 2019 net investment income per share of 45 cents surpassed the Zacks Consensus Estimate of 40 cents. Also, the bottom line grew 9.8% from the year-ago quarter.

Results benefited from higher total investment and other income. Also, the company’s balance sheet position and portfolio activity remained strong in the quarter. However, rise in expenses was an undermining factor.

Net investment income of $11.1 million increased 8.5% year over year.

In 2019, net investment income was $1.54 per share, beating the consensus estimate of $1.52 but fell from $1.71 recorded in the prior year. Net investment income was $38.3 million, up 9.3%.

Total Investment Income & Expenses Rise

Total investment and other income for the reported quarter were $21.3 million, up 19.5% year over year. The rise was mainly driven by significant improvement in other income. Also, the figure beat the Zacks Consensus Estimate of $20 million.

In 2019, total investment and other income increased 13.5% to $73.4 million. It also outpaced the consensus estimate of $72.1 million.

Total operating expenses rose 34.3% year over year to $10.2 million. The increase reflected a rise in almost all expense components, except for income incentive fee.

Balance Sheet Strong

As of Dec 31, 2019, TriplePoint’s net asset value was $13.34 per share compared with $13.50 as of Dec 31, 2018.

The company had $64.1 million in liquidity, consisting of $26.4 million in cash and $37.7 million of available capacity under its revolving credit facilities, as of Dec 31, 2019.

As of Dec 31, 2019, total assets amounted to $684.1 million, up from $467.1 million as of Dec 31, 2018.

Total Portfolio Value & New Commitments

The fair value of TriplePoint’s total investment portfolio was $653.1 million as of Dec 31, 2019, up from $433.4 million as of Dec 31, 2018.

In the reported quarter, the company closed $129.1 million in new debt commitments and funded $170.9 million in debt investments.

Our Take

TriplePoint’s investment income is expected to continue improving, driven by the rise in demand for customized financing and strong economy. However, elevated expenses (witnessed in the reported quarter as well) may hurt the bottom line.

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

TriplePoint Venture Growth BDC Corp. Price, Consensus and EPS Surprise

TriplePoint Venture Growth BDC Corp. Price, Consensus and EPS Surprise

TriplePoint Venture Growth BDC Corp. price-consensus-eps-surprise-chart | TriplePoint Venture Growth BDC Corp. Quote

Performance of Other Finance Stocks

Ares Capital Corporation’s (NASDAQ:ARCC) fourth-quarter 2019 core earnings of 45 cents per share met the Zacks Consensus Estimate and were in line with the year-ago quarter’s figure.

Hercules Capital Inc.’s (NYSE:HTGC) fourth-quarter 2019 net investment income of 38 cents per share outpaced the Zacks Consensus Estimate of 36 cents. The bottom line grew 18.8% from the year-ago quarter’s reported figure.

Capitala Finance Corp.’s (NASDAQ:CPTA) fourth-quarter 2019 net investment income per share of 12 cents missed the Zacks Consensus Estimate of 22 cents. The bottom line was 45.5% lower than the prior-year quarter’s number.

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