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Solar Senior Capital reports good Q4/2016

|Includes: Solar Senior Capital (SUNS)

NII meets expectations and covers the dividend. NAV rose two cents due to portfolio gains. That is a good quarter. It is very good to have those events during a quarter when the share count rose.

The Yahoo consensus projections:

  Current Qtr. (Mar 2017) Next Qtr. (Jun 2017) Current Year Next Year
No. of Analysts 5 5 5 1
Avg. Estimate 0.35 0.35 1.42 1.43
Low Estimate 0.34 0.35 1.4 1.43
High Estimate 0.35 0.35 1.43 1.43
Year Ago EPS 0.35 0.36 1.42 1.42
Revenue Estimate Current Qtr. (Mar 2017) Next Qtr. (Jun 2017) Current Year Next Year
No. of Analysts 4 4 4 N/A
Avg. Estimate 7.69M 8.1M 33.07M N/A
Low Estimate 7.27M 7.69M 31.62M N/A
High Estimate 7.92M 8.42M 34.57M N/A
Year Ago Sales 6.35M 6.68M 27.2M 33.07M
Sales Growth (year/est) 21.10% 21.20% 21.60% N/A

My spreadsheets:

  Q4-16 Q3-16 Q2-16 Q1-16 Q4-15 Q3-15 Q2-15 Q1-15 Q4-14 Q3-14 Q2-14 Q1-14 Q4-13 Q3-13 Q2-13 Q1-13
Realized & Unrealized Gains in millions 0.346 0.633 0.608 4.349 -8.497 -5.580 -0.450 0.201 -0.002 -1.782 -0.475 0.135   -0.684 -1.843 -0.245
Realized & Unrealized Gains/share 0.0216 0.0512 0.0527 0.3771 -0.7368 -0.4838 -0.0390 .0177 -.0002 -.1545 -.0414 .0117   -.0593 -.1598 -.0212
  Q4-16 Q3-16 Q2-16 Q1-16 Q4-15 Q3-15 Q2-15 Q1-15 Q4-14 Q3-14 Q2-14 Q1-14 Q4-13
Total investment income 7.165 7.001 6.681 6.349 6.148 6.520 6.655 6.143 5.912 5.322 5.134 5.736 5.654
Net investment income 5.649 4.536 4.066 4.065 4.066 4.085 3.3462 3.876 4.018 3.528 2.4151 3.853 3.644
Investments @ fair value 0.365 0.328 0.326 0.312 0.306 0.340 0.347 0.345 0.341 0.278 0.266 0.275 0.268
Wt Av Share Count 16.025 12.359 11.533 11.533 11.533 11.533 11.533 11.533 11.533 11.533 11.533 11.532 11.532
TII/share $0.4471 $0.5665 $0.5793 $0.5505 $0.5331 $0.5653 $0.5770 $0.5326 $0.5126 $0.4615 $0.4452 $0.4974 $0.4902
NII/share $0.3525 $0.3670 $0.3525 $0.3525 $0.3525 $0.3542 $0.29012 $0.3361 $0.3484 $0.3059 $0.20941 $0.3341 $0.3160
NAV/share $16.80 $16.78 $16.76 $16.70 $16.33 $17.06 $17.55 $17.65 $17.65 $17.65 $17.85 $18.04 $18.04
Wt Av Yield 7.8% 8.2% 8.2% 7.9% 7.9% 7.2% 7.0% 6.9% 7.0% 7.2% 7.4% 7.7% 7.5%
NII/TII ratio 78.8% 64.8% 60.9% 64.0% 66.1% 62.6% 51.0% 63.1% 68.0% 66.3% 47.0% 67.2% 64.4%
1 Q2-14 contained a $1 million one time fee for an amendment and extension of the credit facility
2 Q2-15 contained a $0.8 million one time fee for an amendment and extension of the credit facility

Q3-16 ended with a very low debt amount. Going by the interest charged in the quarter - the average debt amount (the metric that should correlate to the interest amount charged) was much higher. The result is an atypical and probably faulty interest expense to debt number. I use the best metrics I can find. Sometimes, the best is not good enough.

  Q4-16 Q3-16 Q2-16 Q1-16 Q4-15 Q3-15 Q2-15 Q1-15 Q4-14 Q3-14 Q2-14 Q1-14
Debt 98,300 43,000 141,600 129,100 116,200 146,800 143,400 140,900 143,200 76,400 20,700 56,600
Debt/share 6.1342 3.4792 12.2778 11.1940 10.0754 12.7287 12.4339 12.2171 12.4765 6.6245 1.7950 4.9081
Debt/share to NAV 36.51% 20.73% 73.26% 67.03% 61.70% 74.61% 70.85% 69.22% 70.35% 37.72% 9.95% 27.11%
Interest expense 647 870 913 851 1,314 895 1,160 832 747 556 1,400 437
Interest expense/share 0.0404 0.0704 0.0792 0.0738 0.1139 0.0776 0.1006 0.0721 0.0648 0.0482 0.1214 0.0379
Interest expense/TII 9.03% 12.43% 13.65% 13.40% 21.37% 13.73% 17.43% 13.54% 12.64% 10.83% 24.40% 7.73%
Annualized Int exp/Debt 2.63% 8.09% 2.58% 2.64% 4.52% 2.44% 3.24% 2.36% 2.09% 2.91% 27.05% 3.09%
PWAY - Int exp/Debt 517 bps 11 bps 562 bps 526 bps 338 bps 476 bps 376 bps 454 bps 491 bps 429 bps N/A 441 bps
BDCs report debt at the end of the quarter and not a weighted average debt amount - which could vary significantly from the average amount
Q2-14 contained "approximately $1.0 million of non-recurring expenses related to the amendment and extension of our credit facility" till 2019
Q2-15 contained "approximately $0.8 million of non-recurring expenses related to the amendment and extension of our credit facility" till 2020
10-Q: average annualized interest cost for all borrowings for the 6 months ended Q2-16 was 2.54% and the year 2015 was 2.25% exclusive of unused fees
Debt is an ending number - not an average number. The interest expense level sometimes correlates to the ending debt level of the prior quarter

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.