Crescent Capital: 11% Yield And Fire Sale Price Make It A Buy

(9min)

Summary

  • Crescent Capital BDC offers a compelling 10.9% dividend yield and trades at a 22% discount to NAV, providing a strong margin of safety.
  • Recent headwinds, including lower NII and some non-accruals, are largely priced in, with the portfolio remaining healthy and well-protected by first-lien debt.
  • Management's confidence is evident through continued regular dividends and two special dividends, signaling belief in near-term NII recovery.
  • With the potential for valuation re-rating as non-accruals resolve, CCAP presents an attractive buy-the-dip opportunity for income-focused investors seeking potentially strong total returns.
  • Looking for a portfolio of ideas like this one? Members of iREIT®+HOYA Capital get exclusive access to our subscriber-only portfolios. Learn More »
Golden 11% 3d isolated on white background. 11% off 3D. 11% mega sale or eleven percent bonus. Sale of special offers. 3d rendering.

Vivek Vishwakarma

Bargain hunting for income stocks can be a rewarding endeavor. Of course, no stock goes down in price without having some risk factors. As such, it’s up to the enterprising investor to determine whether headwinds are temporary or represent structural flaws in the business

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Analyst’s Disclosure: I/we have a beneficial long position in the shares of CCAP 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 am not an investment advisor. This article is for informational purposes and does not constitute as financial advice. Readers are encouraged and expected to perform due diligence and draw their own conclusions prior to making any investment decisions.

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