Stellus Capital Investment (SCM) Downgraded to “Sell” at Zacks Investment Research

Zacks Investment Research cut shares of Stellus Capital Investment (NYSE:SCM) from a hold rating to a sell rating in a research report sent to investors on Tuesday, Zacks.com reports.

According to Zacks, “Stellus Capital Investment Corporation is a closed-end, non-diversified management investment company. The Company’s investment objective is to maximize the total return to its stockholders in the form of current income and capital appreciation by investing primarily in private middle-market companies. “

Shares of SCM stock opened at $14.03 on Tuesday. The company has a current ratio of 0.36, a quick ratio of 0.22 and a debt-to-equity ratio of 0.73. Stellus Capital Investment has a 12 month low of $11.65 and a 12 month high of $15.30. The stock has a market cap of $267.14 million, a price-to-earnings ratio of 9.88 and a beta of 0.76.

Stellus Capital Investment (NYSE:SCM) last released its quarterly earnings results on Friday, May 10th. The investment management company reported $0.34 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.35 by ($0.01). The company had revenue of $13.84 million during the quarter, compared to analysts’ expectations of $14.13 million. Stellus Capital Investment had a net margin of 51.60% and a return on equity of 9.97%. On average, research analysts anticipate that Stellus Capital Investment will post 1.35 EPS for the current fiscal year.

The business also recently declared a monthly dividend, which was paid on Wednesday, May 15th. Stockholders of record on Tuesday, April 30th were paid a $0.1133 dividend. This represents a $1.36 dividend on an annualized basis and a dividend yield of 9.69%. The ex-dividend date of this dividend was Friday, April 26th. Stellus Capital Investment’s dividend payout ratio (DPR) is 95.77%.

Several institutional investors have recently added to or reduced their stakes in SCM. Sumitomo Mitsui Asset Management Company LTD purchased a new stake in shares of Stellus Capital Investment in the 4th quarter valued at approximately $423,000. Janney Montgomery Scott LLC purchased a new stake in shares of Stellus Capital Investment in the 4th quarter valued at approximately $148,000. Raymond James & Associates raised its stake in shares of Stellus Capital Investment by 22.4% in the 4th quarter. Raymond James & Associates now owns 96,878 shares of the investment management company’s stock valued at $1,255,000 after acquiring an additional 17,726 shares during the period. Two Sigma Investments LP raised its stake in shares of Stellus Capital Investment by 27.7% in the 4th quarter. Two Sigma Investments LP now owns 26,334 shares of the investment management company’s stock valued at $341,000 after acquiring an additional 5,708 shares during the period. Finally, Oppenheimer & Co. Inc. raised its stake in shares of Stellus Capital Investment by 5.1% in the 1st quarter. Oppenheimer & Co. Inc. now owns 40,804 shares of the investment management company’s stock valued at $577,000 after acquiring an additional 1,977 shares during the period. 16.97% of the stock is currently owned by institutional investors and hedge funds.

Stellus Capital Investment Company Profile

Stellus Capital Investment Corporation is a business development company specializing in investments in private middle-market companies. It invests through first lien, second lien, unitranche, and mezzanine debt financing, often with a corresponding equity investment. The fund seeks to invest in companies with an EBITDA between $5 million and $50 million.

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