Today's drop in share price due to Wells Fargo downgrade to Market Perform due to concern about "the dividend being in excess of current earnings and adjusted cash flow ." The current NAV is $16.73 . The co. has .55 /share for future distributions. Buying opportunity ?
Yeah, I bought some back at $16.12 this a.m. Saw the Wells downgrade . . . they took from their highest level to second. I don't have any illusions . . . HRZN is right around fair value given the issues they face (basically, all relate to being below critical mass and therefore unable to generate enough NII to cover the big dividend increase). But this is the only BDC tht has what I consider to be strong management that has a good dividend and still trades below NAV. Most are now 5-15% above NAV.
Unless the secondary markets for their companies falls out of bed they will get some decent exits and cap gains over the next couple of quarters. Plus they have the recent secondary proceeds to lever up. The dividend is safe (and heckuva lot safer than PSEC, KCAP, and TICC, where a huge chunk comes from equity tranches of CLOs).