Apollo Investment Corporation’s AINV shares lost 1.3% following the release of first-quarter fiscal 2020 (ended Jun 30) results last week. Net investment income of 43 cents per share lagged the Zacks Consensus Estimate by a penny. Also, the bottom line declined 14% year over year.
The results were hurt by lower total investment income. However, decline in expenses and decent portfolio activity during the quarter were tailwinds.
Net investment income was $28.2 million, down 18.3% from the prior-year quarter.
Total Investment Income & Expenses Decline
Total investment income was $56.7 million, down 14.8% year over year. The fall was mainly due to lower Payment-in-kind interest income.
Total expenses, net of management and performance-based incentive fee waive, and expense reimbursements declined 11.1% year over year to $28.4 million.
Decent Balance Sheet Position
As of Jun 30, 2020, the company’s cash and cash equivalents (including foreign currencies) totaled $44.4 million, up from $43.7 million on Mar 31, 2020.
Further, as of Jun 30, 2020, Apollo Investment had $1.76 billion of debt obligations. This included $350 million of Senior Unsecured Notes and $1.410 billion outstanding under the credit facility.
Apollo Investment’s total assets amounted to $2.81 billion, down from $2.87 billion as of Mar 31, 2020.
Net asset value was $15.29 per share, down from $15.70 as of Mar 31, 2020.
Modest Portfolio Activity
The fair value of Apollo Investment’s total investment portfolio was $2.67 billion as of Jun 30, 2020.
In the reported quarter, the company originated $137.9 million of investments and had $163.8 million of repayments.
Continued decent origination volumes are expected to support Apollo Investment’s financials. Also, lower expenses will likely aid the bottom line to some extent.
Apollo Investment Corporation Price, Consensus and EPS Surprise
Apollo Investment Corporation price-consensus-eps-surprise-chart | Apollo Investment Corporation Quote
Currently, it carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Finance Stocks
Hercules Capital Inc.’s HTGC second-quarter 2020 net investment income of 32 cents per share lagged the Zacks Consensus Estimate by a penny. The bottom line also declined 11.1% from the year-ago reported figure.
Ares Capital Corporation’s ARCC second-quarter 2020 core earnings of 39 cents per share beat the Zacks Consensus Estimate by a penny. However, the bottom line declined 20.4% year over year.
TriplePoint Venture Growth BDC Corp.’s TPVG second-quarter 2020 net investment income of 38 cents per share surpassed the Zacks Consensus Estimate of 36 cents. However, the bottom line declined 7% from the year-ago quarter.
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