NEWTI - Newtek Business Services Has Bright Future In Spite Of Dividend Cut

• NEWT’s business is focused on providing loans to small businesses. It has benefited immensely from the government’s aggressive stimulus programs in response to Covid-19.
• Unlike most BDCs, it also generates income from a variety of related technology and services businesses. This makes it more resilient to credit problems.
• NEWT is internally managed, reducing conflicts of interest common in the BDC sector. Additionally, the management team owns 6.3% of outstanding shares, so their interests are well aligned with outside.
• NEWT’s reliance on small businesses makes it vulnerable to macroeconomic downturns. Additionally, it is highly dependent on economic stimulus and economic policy that is beneficial to small businesses.
• Although NEWT reduced its dividend recently, there is a decent chance it will surprise on the upside early next year. With a double digit yield, NEWT makes a great addition to an income portfolio.

For further details see: