Eagle Point Credit Management LLC and Eagle Point DIF GP I LLC, both significant stakeholders in OFS Credit Company, Inc. (NASDAQ:OCCI), have recently sold a portion of their holdings in the company. The transactions, which took place on June 25, 2024, involved the sale of OFS Credit Company's 6.125% Series C Term Preferred Stock due 2026.
The total value of the preferred stock sold amounted to $1,066, with each share being sold at $24.23. Following the sale, the remaining shares owned by the entities amounted to 33,875. It's important to note that the shares are directly held by private investment funds managed by Eagle Point Credit Management LLC. Eagle Point DIF GP I LLC serves as the general partner to some of these funds.
The filings also indicate that both Eagle Point Credit Management and Eagle Point DIF GP I LLC could be deemed to have an "indirect pecuniary interest" in the securities reported, as per the footnotes in the SEC filing. However, they have disclaimed beneficial ownership of the securities described in the report, stating that the inclusion of these securities in this report should not be considered an admission of beneficial ownership for any purpose.
Kenneth P. Onorio, the Chief Financial Officer for both entities, signed off on the transactions. The sale of these preferred stocks represents a change in the investment profile of the reporting entities with respect to OFS Credit Company, a company known for its focus on investing in debt instruments of U.S. companies.
In other recent news, OFS Credit Company, an investment firm, released an estimated net asset value (NAV) per share for the end of March 2024. According to the company's unaudited figures, the NAV per share of common stock is projected to be between $7.42 and $7.52. The company emphasized that this preliminary estimate has not undergone the usual quarter-end financial closing procedures and the actual NAV per share could materially differ from the current estimate. The confirmed NAV per share for the period ending April 30, 2024, will be detailed in the company's upcoming Semi-Annual Report on Form N-CSR. The company's financial position could be influenced by various factors including heightened interest and inflation rates, geopolitical tensions, and uncertainties within the U.S. and global banking systems. Risks of a U.S. recession or government service shutdown could also impact the company's future net investment income and the value of its investment portfolio. The preliminary financial data has not been audited or reviewed by KPMG LLP.
InvestingPro Insights
OFS Credit Company, Inc. (NASDAQ:OCCI) has been making headlines with the recent sale of its preferred stock by significant stakeholders. For investors watching OCCI, there are several key metrics and insights from InvestingPro that could shed light on the company's current financial health and investment profile.
Firstly, OCCI boasts a market capitalization of $114.67 million, which positions it as a small-cap company with potential for growth. The company has a Price-to-Earnings (P/E) ratio of 13.16, suggesting that the stock is reasonably valued compared to earnings. For income-focused investors, OCCI's substantial dividend yield of 17.48% as of mid-2024 is particularly attractive, supported by a solid track record of profitability over the last twelve months.
In terms of financial performance, OFS Credit Company reported a revenue of $32.82 million for the last twelve months as of Q2 2024, with a revenue growth of 14.19% during the same period. This indicates a healthy upward trajectory in the company's earnings capability. Additionally, the company's gross profit margin stands at an impressive 100%, reflecting strong operational efficiency.
Investors considering OCCI should also note the company's low price volatility, which can be a sign of a stable investment. Moreover, the company's liquid assets exceed its short-term obligations, underscoring a solid financial position. However, potential investors should be aware of the company's poor free cash flow yield as highlighted by an InvestingPro Tip, which could affect future dividend payments or investment in growth.
For those interested in further insights and tips, there are additional InvestingPro Tips available at https://www.investing.com/pro/OCCI. By using the coupon code PRONEWS24, readers can get an additional 10% off a yearly or biyearly Pro and Pro+ subscription to access these valuable investment tips.
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