New Mountain Finance (NASDAQ:NMFC) Shares Gap Down – Should You Sell?

New Mountain Finance Corporation (NASDAQ:NMFC) shares gapped down before the market opened on Tuesday . The stock had previously closed at $8.56, but opened at $8.00. New Mountain Finance shares last traded at $8.1750, with a volume of 199,459 shares traded.

Analyst Upgrades and Downgrades

Several brokerages recently commented on NMFC. B. Riley Financial dropped their target price on New Mountain Finance from $10.00 to $7.50 and set a “neutral” rating on the stock in a report on Tuesday, March 3rd. Keefe, Bruyette & Woods decreased their target price on shares of New Mountain Finance from $10.00 to $9.00 and set a “market perform” rating for the company in a research note on Wednesday, March 4th. Weiss Ratings reaffirmed a “hold (c-)” rating on shares of New Mountain Finance in a research note on Tuesday, April 21st. Wells Fargo & Company cut their price objective on shares of New Mountain Finance from $10.00 to $8.00 and set an “equal weight” rating on the stock in a report on Thursday, February 26th. Finally, Wall Street Zen upgraded New Mountain Finance from a “sell” rating to a “hold” rating in a research note on Sunday, April 5th. Five research analysts have rated the stock with a Hold rating and two have given a Sell rating to the stock. Based on data from MarketBeat, New Mountain Finance presently has a consensus rating of “Reduce” and a consensus price target of $9.25.

New Mountain Finance Stock Performance

The firm has a market cap of $797.16 million, a price-to-earnings ratio of -14.55 and a beta of 0.57. The stock’s fifty day moving average is $8.02 and its two-hundred day moving average is $8.76. The company has a debt-to-equity ratio of 1.26, a quick ratio of 3.16 and a current ratio of 2.02.

New Mountain Finance (NASDAQ:NMFC) last posted its earnings results on Monday, May 4th. The company reported $0.32 EPS for the quarter, meeting the consensus estimate of $0.32. New Mountain Finance had a positive return on equity of 11.14% and a negative net margin of 18.65%.The firm had revenue of $41.27 million for the quarter, compared to analysts’ expectations of $67.76 million. During the same period last year, the firm earned $0.32 EPS. The firm’s revenue was down 19.7% compared to the same quarter last year. On average, analysts expect that New Mountain Finance Corporation will post 1.12 earnings per share for the current fiscal year.

New Mountain Finance Cuts Dividend

The business also recently declared a quarterly dividend, which will be paid on Tuesday, June 30th. Stockholders of record on Tuesday, June 16th will be paid a $0.25 dividend. This represents a $1.00 dividend on an annualized basis and a dividend yield of 11.8%. The ex-dividend date of this dividend is Tuesday, June 16th. New Mountain Finance’s dividend payout ratio is currently -220.69%.

Insider Activity at New Mountain Finance

In other news, Director Steven B. Klinsky purchased 276,242 shares of the firm’s stock in a transaction on Wednesday, March 11th. The stock was purchased at an average cost of $8.05 per share, with a total value of $2,223,748.10. Following the purchase, the director owned 5,370,858 shares in the company, valued at $43,235,406.90. This trade represents a 5.42% increase in their position. The transaction was disclosed in a document filed with the SEC, which is available through this hyperlink. Also, EVP Adam B. Weinstein bought 12,900 shares of the firm’s stock in a transaction that occurred on Tuesday, March 17th. The shares were purchased at an average cost of $7.61 per share, with a total value of $98,169.00. Following the purchase, the executive vice president directly owned 751,756 shares of the company’s stock, valued at approximately $5,720,863.16. This represents a 1.75% increase in their ownership of the stock. The SEC filing for this purchase provides additional information. Insiders have purchased 1,200,673 shares of company stock worth $9,662,634 over the last quarter. 14.90% of the stock is currently owned by company insiders.

Institutional Inflows and Outflows

Several institutional investors have recently modified their holdings of the stock. Mackenzie Financial Corp raised its position in shares of New Mountain Finance by 3.7% during the third quarter. Mackenzie Financial Corp now owns 31,306 shares of the company’s stock worth $302,000 after purchasing an additional 1,126 shares during the period. CANADA LIFE ASSURANCE Co raised its holdings in New Mountain Finance by 2.8% during the 2nd quarter. CANADA LIFE ASSURANCE Co now owns 95,805 shares of the company’s stock worth $1,013,000 after buying an additional 2,634 shares during the period. Advyzon Investment Management LLC lifted its stake in New Mountain Finance by 25.3% during the fourth quarter. Advyzon Investment Management LLC now owns 16,080 shares of the company’s stock valued at $148,000 after buying an additional 3,246 shares in the last quarter. Next Capital Management LLC boosted its holdings in shares of New Mountain Finance by 13.5% in the fourth quarter. Next Capital Management LLC now owns 29,680 shares of the company’s stock worth $273,000 after buying an additional 3,530 shares during the period. Finally, Inspire Investing LLC increased its position in shares of New Mountain Finance by 8.5% in the fourth quarter. Inspire Investing LLC now owns 50,906 shares of the company’s stock worth $469,000 after acquiring an additional 4,000 shares in the last quarter. Institutional investors own 32.08% of the company’s stock.

New Mountain Finance Company Profile

New Mountain Finance Corp. is a closed-end, externally managed business development company (BDC) that provides customized debt and equity capital solutions to U.S. middle-market companies. As a BDC organized under the Investment Company Act of 1940, New Mountain Finance invests in sponsor-backed and founder-led businesses that span a range of industry sectors, with a focus on companies demonstrating resilient growth and recurring revenue streams.

The company’s investment portfolio typically includes first-lien senior secured loans, second-lien and junior debt instruments, mezzanine financing and equity co-investments.