Look at the schedule of investments in their last filed 10-Q. Last time I checked, oil services companies were ~ 9% of their investments.
Any one on this board have any idea of the percentage of their loan portfolio to energy stocks, or a link to their loan portfolio ? What out that basic info don't know how any one could consider taking a position in this stock
TCAP is down because of exposure to oil service industry. It's been going down since end of September when oil started its downward spiral. I am waiting to see a rise in oil prices before buying TCAP
It seems the bad news was the two new 'non accruals'. That looks to be a one time event. So if they are able to keep the 'stable dividend' for a couple of quarters, and resolve those issues...plus new acquisitions.. I am expecting 2015 to be more of the same as before.
Still haven't bought... looking like a great value but I think I want to wait for the dividend cut that is implied by the current yield first.
I wouldn't categorize TCAP as a "safe" stock. After all, they primarily invest in sub debt of lower middle market companies. But I would categorize them as one of the best run BDC's in the sector, producing superior returns over time, and doing so investing in a riskier niche of the market.
That said, TCAP's credit problems in Q3 were bad, and in the current market, BDC's with company specific issues are getting punished especially hard.
I'd like to put a couple of things in perspective. First is TCAP's dividend coverage. In Q3 NII was $0.51 vs the regular dividend of $0.54. TCAP will likely fall short of covering the regular dividend via NII in Q4, but by a smaller amount, as the $130mm in net portfolio growth from Q3 will fully contribute to Q4's earnings and over $100mm in new investments have been reported so far in Q4.
The specials are more than covered by net realized capital gains. So far in 2014 TCAP has reported over $16.7mm in net realized gains, = to $0.51 per share. Last year TCAP reported another $18.4mm in net realized gains, = to $0.56 per share. This is why TCAP has been paying out specials all year despite NII running a bit behind the regular dividend.
Barring any more setbacks, TCAP's NII likely covers the regular dividend in Q115 and by the second half of 2015, NII should exceed the regular dividend. The net realized gains are more than enough to cover those $0.05 quarterly specials and any temporary shortfall on the regular dividend.
The other issue is TCAP's credit quality. In a nutshell, historically TCAP has the 2nd best record with regard to credit quality in the sector. That's why they have all those accumulated net realized gains. OTOH, Q314 was terrible. The question for investors going forward is: "Was Q3-14 an anomaly, or is it the beginning of a trend?"
Even good BDC's sometimes have a bad quarter. It's my guess that this is what's happening here. We do our DD and place our bets. Only time will tell which side is right.
Both are very small cap companies and small caps are undrr more pressure than the genersl market and have been. You guys can argue with me and try to defend this company but it is a bad investment and you know it.
I thought tcap was a safe stock. Guess it isn't immune to the industry. Have LT gains coming next year so will trim TCAP after the first of the year once it rebounds from tax loss and any Santa rally as I've bought replacement shares earlier this month....
I hope you can explain your AGNC "tanking" comment. Despite the recent market decline and the fact that AGNC pays close to a 12% dividend as opposed to retaining money and increasing book value, it is trading in the middle of its 52 week range.
agnc & tcap are in completely different businesses. tcap is the best buy in the bdc sector, expect at least 20% total return over 2015.