Venture Debt Opportunity Yielding 13% To 14% For Your Portfolio: Hercules Or TriplePoint?

Summary

  • This article compares HTGC and TPVG, currently paying dividend yields of 13% to 14%, supported by debt and equity investments in venture capital (VC)-backed technology and high-growth companies.
  • We compare the credit quality of their portfolios to identify which one will likely outperform.
  • I currently own one of these BDCs due to its relatively safer portfolio and have provided a list of positive and negative considerations.
  • Please see the end of this article for charts comparing various credit metrics, including the amount of "watch list" investments and the potential impact on NAV, non-accrual investments, and changes in NAV per share for one, three, and five years.
  • Looking for a portfolio of ideas like this one? Members of Sustainable Dividends get exclusive access to our subscriber-only portfolios. Learn More »

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Quick Introduction To Business Development Companies

Business development companies ("BDCs") invest shareholder capital in privately-owned, small- and medium-sized U.S. companies generating income from secured loans and capital gains from equity positions, much like venture capital or private equity funds. Anyone can invest in BDCs as they're

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This article was written by

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BDC Buzz is a professional money manager with over a decade of experience generating institutional-quality research.

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Analyst’s Disclosure:I/we have a beneficial long position in the shares of HTGC either through stock ownership, options, or other derivatives. 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.

I have positions in 18 BDC stock positions, only one of which was discussed 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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SymbolLast Price% Chg
HTGC
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TPVG
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