As an income-driven investor I tend to look for higher-yielding stocks which are currently experiencing an uptrend, and as a result could signal a buying mode for traders. For a stock to be considered in an uptrend, shares must be simultaneously trading above their current 20-day, 50-day and 200-day simple moving averages. In this article, I wanted to focus on two asset management companies yielding at least 8.50%, currently in the midst of an uptrend and up at least 5.00% since January 1st.
The Blackstone Group, LP (BX) - Based in New York, New York, and together with its subsidiaries, "provides alternative asset management and financial advisory services worldwide. It operates in five segments: Private Equity, Real Estate, Hedge Fund Solutions, Credit Businesses, and Financial Advisory".
Shares of BX, which are currently priced at $18.78 and yield 8.95% ($1.68) are considered to be in the midst of an uptrend since they are trading 1.25% above their 20-DSMA, 9.56% above their 50-DSMA, and 31.52% above their 200-DSMA. From a growth perspective shares of BX have risen 15.94% since January 1st.
One of the more important key catalysts behind my decision to establish a position in Blackstone, comes from the company's full year results which were announced back on January 31st.
According to the company's Chairman and CEO, Steven A. Schwarzman, "Our favorable performance continues to support the positive cycle of further growth, as our current investors reinvest with us and we also attract new investors around the world. For the full year we reported gross organic capital inflows of $34 billion, and returned $18 billion to our investors, resulting in record total assets under management of $210 billion, up 26% year over year".
If Blackstone can continue to increase its organic capital inflows and assets under management, which are both up considerably year-over-year, I see no why income investors should not establish a position at current levels.
Gladstone Capital Corp. (GLAD) - Based in McLean, Virginia the company "is a business development firm specializing in investments in debt and equity securities. The fund primarily invests in various categories of debt of private companies comprising senior loans, senior term loans, second lien term loans, senior subordinated loans, mezzanine loans, and junior subordinated loans. It provides loans for initial acquisition of portfolio companies, add-on acquisitions, recapitalization, including cash-outs and senior debt reduction and in some cases short-term bridge financing in the range of $5 million to $30 million that generally mature in no more than seven years".
Shares of GLAD, which are currently priced at $9.08 and yield 9.25% ($0.84) are considered to be in the midst of an uptrend since they are trading 0.22% above their 20-DSMA, 3.93% above their 50-DSMA, and 11.82% above their 200-DSMA. From a growth perspective shares of GLAD have risen 8.48% since January 1st.
When it comes to Gladstone, I think that potential investors need to consider the company's increase in net assets over the last quarter as the company has to potential to see similar increases over the next several quarters.
Increase In Net Assets: "For the quarter ended December 31, 2012, we had approximately $193 million in net assets as compared to $189 million in net asset as of September 30, 2012. It represents a NAV per common share of $9.17 as of December 31, as compared to $8.98 as of September 30".
The good news here is that every $4 million dollar increase in net assets represents a $0.19 increase. If the company, can continue to demonstrate similar increase in net assets over the 12-24 months, shares of Gladstone have the potential to carry a NAV per share of $9.36 by the end of 2013 and a NAV per share of $9.55 by the end of 2014.
Based on Friday's closing price of $9.08/share, shares are currently trading just under 1% of NAV and by coupling that discount with the company's current yield of 9.25%, Gladstone could be a viable option for both value and income investors for at least the next 12-24 months.