Bank of America Securities analyst Derek Hewett has reiterated their bullish stance on TSLX stock, giving a Buy rating on November 3.
Derek Hewett’s Buy rating on Sixth Street Specialty Lending (TSLX) is driven by several key factors.
Firstly, Sixth Street reported a strong quarter which showcased its unique platform, robust risk management, and solid liquidity. The company’s Adjusted Core EPS of $0.60 surpassed the consensus expectations of $0.57. This discrepancy is primarily attributed to the recurring interest income. Additionally, the company’s GAAP EPS was $0.74 due to portfolio appreciation. Amid a complex market environment, Hewett believes that Sixth Street is well positioned to generate potent risk-adjusted returns, hence justifying its premium valuation.
Furthermore, Sixth Street demonstrated firm credit metrics with non-accruals constituting only 0.9% of the portfolio. The portfolio yield also saw an increase, rising to 14.3% from 14.1% in the previous quarter, driven by the rise in base rates. The total investment income exceeded the forecast, mainly due to higher recurring interest income. With an impressive GAAP ROE of 17.6% and an increase in NAV/share, Hewett considers the company’s financial health to be stable and well-balanced, thus reinforcing his Buy rating.
According to TipRanks, Hewett is a 4-star analyst with an average return of 9.5% and a 62.37% success rate. Hewett covers the Financial sector, focusing on stocks such as Ellington Financial, BlackRock TCP Capital, and MidCap Financial Investment Corporation.
In another report released on November 3, JMP Securities also reiterated a Buy rating on the stock with a $21.00 price target.
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Sixth Street Specialty Lending (TSLX) Company Description:
TPG Specialty Lending, Inc. is a specialty finance company, which focuses on lending to middle-market companies. Its investment comprises first-lien debt, second-lien debt, mezzanine and unsecured debt and equity, and other investments. The company was founded in July 2011 and is headquartered in Fort Worth, TX.
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