Stellus Capital: Potential Negative Growth, Non-Accruals And Lofty Valuation Could Hinder Returns

Komal Sarwar
1.58K Followers
(9min)

Summary

  • Stellus Capital Investment Corporation is struggling to generate market-beating returns because of sluggish share price momentum.
  • Q2 earnings exceeded expectations due to waived incentive fees and portfolio growth strategy.
  • Potential rate cuts, significant share issuance, and increasing non-accruals pose risks to financial growth and returns for shareholders.
  • Investors may consider other options for market-beating returns.

Paper boat with $1 bill sail is blown onshore

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Despite offering a double-digit dividend yield, Stellus Capital Investment Corporation's (NYSE:SCM) has been struggling to outperform the S&P 500 in total returns. I believe this trend is likely to continue because the potential impact of

This article was written by

1.58K Followers
Komal is passionate about finance and the stock market. She enjoys forecasting future market trends using a fundamental and technical approach with a focus on both short- and long-term horizons. She intends to provide unbiased analysis to assist investors in selecting the best investment strategies to stay ahead of the market.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. 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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