2024-07-21 10:49:05 ET
Summary
- Crescent Capital BDC offers a high dividend yield of 8.9% with a focus on stability and income for investors.
- CCAP's portfolio consists of floating rate debt with a majority of investments on a first lien basis, providing protection in case of defaults.
- Despite potential interest rate cuts, CCAP's strong financial performance and distribution coverage make it a buy for income-focused investors.
- The distribution is covered by net investment income by a large 150% rate.
- The price has run up and now CCAP trades at a less attractive discount to NAV. However, future portfolio growth may justify this.
Overview
Business Development Companies continue to be a great place to earn a higher yield and benefit from the higher interest rate environment. Crescent Capital BDC (CCAP) has continued to rake in higher levels of net investment income, but the environment may be changing with interest rate cuts on the horizon. When I previously covered CCAP back in April, interest rate cuts seemed unlikely. However, recent economic data may be signaling a change in the market, and I thought it would be a good time to revisit CCAP and provide some updated insights into the BDC's performance. We can see that CCAP has moved up in price by about 8% and the high distribution rate has increased the total return over 15%....
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Crescent Capital: Solid BDC With Strong Dividend Coverage