CCAP - Crescent Capital: Dividend Coverage Supported By Higher Interest Rates

2024-04-26 00:51:57 ET

Summary

• Business Development Companies like Crescent Capital provide an opportunity to collect high distributions in the current high-interest rate environment.
• CCAP has a diverse portfolio of 186 companies across different industries, mitigating concentration risk. The credit quality remains solid, but non-accruals sit at 2%.
• Net investment income has consistently grown over the last several quarters, and plenty of supplemental distributions have been declared as a result.
• NII was reported at $0.61 which covers the distribution of $0.41 per share by about 148%.

Overview

The rise of interest rates has left many investors scrambling to find the best deals in the market. Unfortunately, many people in the world are on the wrong side of the cash register; they provide the dividends, interest, and debt for the major corporations in the world and dish out most of their wealth without even knowing it. What if there was a way to capitalize on this elevated rate environment and get on the other side of the cash register by instead collecting the dividends, interest, and debt from others? Welcome to the world of Business Development Companies, known as BDCs....

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