Bank of America Securities analyst Derek Hewett has maintained their bullish stance on OBDC stock, giving a Buy rating on May 8.
Derek Hewett has given his Buy rating due to a combination of factors surrounding Blue Owl Capital’s recent performance and financial stability. In the first quarter, the company demonstrated a solid core earnings per share (EPS) of $0.47, which was in line with consensus estimates and only slightly below Bank of America’s expectations, mainly due to an unanticipated increase in interest expenses. Furthermore, the company showed resilience with stable net asset value (NAV) per share, the ability to maintain supplemental dividends, and strong origination activity, all indicative of a robust financial foundation despite minor increases in non-accrual investments and portfolio repayments.
The Blue Owl Capital’s financial health is also supported by a favorable liquidity position and conservative leverage, positioning the company for potential growth. With leverage below the target range, there is ample capacity to expand the portfolio, and the mix of unsecured debt enhances financial flexibility. Moreover, the company has no immediate debt maturities, which mitigates short-term financial risk. Although there was a slight decrease in the overall portfolio value and a modest dip in yield, the company’s ability to weather these pressures supports the analyst’s optimistic outlook and justifies the Buy rating.
In another report released on May 8, KBW also assigned a Buy rating to the stock with a $16.00 price target.
OBDC’s price has also changed moderately for the past six months – from $14.120 to $16.170, which is a 14.52% increase.
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Blue Owl Capital (OBDC) Company Description:
Owl Rock Capital Corp, non traded business development company, seeks investment opportunities in middle market companies located in the US with an EBITDA of $10 to $250 million and annual revenue of $50 million to $2.5 billion. It focuses on broad range of sectors including business services, healthcare services, pharma & healthcare technology, aerospace & defences, software & technology and manufacturing & industrials. The fund provides financing in the form of senior secured or unsecured loans, subordinated loans or mezzanine loans and a lesser extent, equity-related securities and warrants for growth, acquisitions, market or product expansion, re-financings and recapitalizations. Its investment size ranging from $20 to $250 million and it also acts as a lead investor.
