Owl Rock Capital Corp (ORCC) is a specialty finance company that provides direct lending solutions to middle market businesses. Its primary investment goal is to generate current income, but it may also generate capital gains to some extent. The company says it targets opportunities that offer favorable risk-adjusted returns.
Let’s take a look at the company’s latest financial performance and newly added risk factor. (See Owl Rock Capital stock charts on TipRanks).
Owl Rock Capital’s Q2 Financial Results
The company reported net investment income per share of $0.30 for Q2 2021, compared to $0.34 in the same quarter last year and consensus estimates of $0.29. At the end of Q2, Owl Rock Capital had investments in 129 portfolio companies valued at $11.9 billion. The average investment in each portfolio company was $92.3 million.
Owl Rock Capital plans to distribute a quarterly cash dividend of $0.31 per share by November 15 to shareholders on record as of September 30.
The company ended the Q2 with $627.2 million in cash, and $1.6 billion in undrawn credit facilities. The total outstanding debt was $6.5 billion. CEO Craig W. Packer said the company delivered on several objectives it discussed in the past quarters, continued to grow its portfolio, and is within the target leverage range.
Owl Rock Capital’s Risk Factors
The new TipRanks Risk Factors tool shows 109 risk factors for Owl Rock Capital. Since Q4 2020, the company has updated its risk profile with one new risk factor under the Finance and Corporate category.
Owl Rock Capital tells investors that if it invests in public companies, it may face risks unique to those involved with investments in private companies. For example, it cites volatility in the valuation of public companies, and limitations on the ability to exit investments in such companies.
The majority of Owl Rock Capital’s risk factors fall under the Finance and Corporate category, with 61% of the total risks. That is above the sector average of 58%. The company’s stock has gained about 13% since the beginning of 2021.
Analysts’ Take on Owl Rock Capital
In August, RBC Capital analyst Kenneth Lee reiterated a Buy rating on Owl Rock Capital stock, and raised his price target to $16 from $15. Lee’s new price target suggests 11.65% upside potential.
Consensus among analysts is a Strong Buy based on three Buys and one Hold. The average Owl Rock Capital price target of $15.25 implies 6.4% upside potential to current levels.
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