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Hercules Capital: 8% Yield With An Adept Response To The Pandemic

Apr. 01, 2021 6:08 PM ETHercules Capital, Inc. (HTGC)18 Comments
Philip Riekenberg profile picture
Philip Riekenberg


  • Hercules offers 8% yield with exposure to tech and life sciences funding.
  • Hot IPO and special events market has been a boon.
  • The pandemic strategy of building upon existing relationships is paying off.
  • Hercules Advisor represents expansion opportunity.

Business, Technology, Internet and network concept. "r"nStart-up funding crowdfunding investment venture capital. Entrepreneurship.
Photo by putilich/iStock via Getty Images

What originally attracted me:

I was looking for a way to find some exposure to tech IPOs in January 2020 that was less volatile or overpriced than the frothy offerings that have been the

This article was written by

Philip Riekenberg profile picture
I am an investor with an unrelated PhD and no experience in finance. I have been investing for 14 years and keep up with due diligence for the news that affects my own portfolio. I have some opinions that I would like to share with others and this seems to be a fairly reasonable place to do so. I tend to follow a dividend and value approach in my main portfolio, but also have interest in speculative small caps for a smaller portfolio. Free: Readers can get an e-mail once a day from Seeking Alpha that lists all newly published articles of ALL the authors they follow in a single e-mail. To get these updates: - a - Click "Alerts" along the top menu tab (just left of the green PRO tab) - b - Scroll all the way down, and check the box for "author alerts" (2nd box from the bottom) - c - Then you'll be notified by Seeking Alpha once per day of new articles by all authors you follow (in a single e-mail)

Analyst’s Disclosure: I am/we are long HTGC. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (18)

New buyer. Got 5000 last week. I expect in 2-3 years this will be another $MAIN
Steve Rasher profile picture
@Philip Riekenberg Thanks for the nice article on $HTGC. I had originally owned $HTGC because I liked its "venture capital" model, but sold when the former CEO, Manual Henriquez, tried to convince the BoD to move from an internal to an external structure solely to line his own pockets. After he was booted out in 2019, because of his heavy involvement in the college cheating scandal, I kept a close eye on it to see how the management team, now lead by CEO Scott Bluestein, performed. Bluestein was promoted when Henriquez was ousted, and I have been impressed by their performance. As a result, I bought some in May, 2020, added in August, 2020, and just recently added more this January. Solid BDC. Also long $TPVG. Steve
Philip Riekenberg profile picture
@Steve Rasher I had seen mention of the previous CEOs ouster elsewhere, but it fell outside of the scope of the time period I was interested in for the article. HTGC looked primed to run prior to COVID and seems to have made it through the pandemic with a strong balance sheet and pipeline for deals within their portfolio companies.
Steve Rasher profile picture
@Philip Riekenberg Understood, and I agree that it is likely that $HTGC was primed to run prior to Covid. Thus, I may a been a bit tardy in re-establishing my position, but I wanted to see actual improvement before doing so. Alas, one can't have pristine timing in buying and selling, but in this case I believe over the long run the differential in basis will not be significant in my results. Steve
Philip Riekenberg profile picture
@Steve Rasher Yes, it completely makes sense to wait for improvement before committing. Nobody knew what the recovery looked like last April and as you say, it is impossible to pristinely time the markets.
All stocks have risk, I believe this is a medium risk stock. I bought a few thousand shares in 2014 & the stock price is up a little over 20% since then, I have also received about half of my original purchase price in dividends. Not a great return, but it will keep you out of the poor house.
HTGC has had more informative buys than sells in the last month or so. I think for a company like this that's the best and only news you can trust. These guys aren't going to lose their own money...they'll lose shareholders' money at the drop of a hat, but not their own.
hafen profile picture
I bought it last year, it pays well, wish I had bought more. What’s not to like!
Philip Riekenberg profile picture
@hafen agreed, getting paid to wait is excellent...
AnthonyGiordano profile picture
I’m long and accumulating HTGC and TSLX. Will use the dividends in retirement which is about 4 years away. I’m happy with both BDCs. Thanks for the article and highlighting Hercules Advisor services.
Philip Riekenberg profile picture
@AnthonyGiordano glad to be of service, both yields seem to be reasonable in this market... But guaranteed income can be quickly adversely affected by the unforeseen, so be careful with the the weighting in your portfolio.
Bought 3k more last year at $11, and of course I now kick myself for not getting five times as many shares. Oh well, sei la vie.
Philip Riekenberg profile picture
@JDeV yep, be happy with the strong move ...
@JDeV Ce la vie
@trilex C’est la vie. Lol.
DRIP’n these shares for years !!
Ed needs bucks profile picture
Bought April 2020. Price has gone up 43% since. Yields 11.14% at the 11.49 price I bought it at. I'm happy....
Bought first shares of HTGC during summer of 2018. Bought first shares of TPVG during summer of 2015. I have added as new cash became available.
Now hold relatively average size positions in a 65+ position portfolio. No complaints. Certainly enjoy the income. Retired in 2013 and now over 70 years old.
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