2024-06-07 09:00:48 ET
Summary
- Hercules Capital has displayed favorable financial performance in the tech and life sciences industry, with a large lending platform and deep expertise.
- The company has a premium over its peers in the stock market, and its price-to-NAV is 1.59, the highest in the last four years.
- The high valuation is partly due to the current high interest rates. When rates decrease, net investment income will fall by about 30%.
- Lower net investment income means the possibility of lower dividend distributions and a downfall in the stock price.
Overview
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Hercules Capital: A Premium Company, But Better To Wait Until Interest Rates Decrease