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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
New Mountain Finance Corporation (XNAS:NMFC) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
NMFC
Name:
NEW MOUNTAIN FINANCE CORPORATION (XNAS:NMFC)
Sector:
- 45170.00K
Industry:
Asset Management
CEO:
Mr. Robert Hamwee
Total Employees:
0
Our Technological Advancement Rating
Our Rating:
-
-
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF NEW MOUNTAIN FINANCE CORPORATION(NMFC) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND ASSET MANAGEMENT INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
12.93
One Month Price Target:
$13.02
Six Month Price Target :
$13.46
Likely Price in One Year's Time:
Ticker:
$13.98
Likely Trading Range Today Under (Normal Volatility)
$12.87
Price Upper limit ($) :
$12.99
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$12.22
This week:
$11.35
This month :
$9.77
Other Primary facts
Market Cap:
1.30B
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
100.72M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
23.72%
-22.3%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$16.21
$14.71
$9.65
$11.15
Medium risk (<10%) entry points
Buy Call
Sell Call
$14.22
Buy Put:
Sell Put:
$13.90
$11.63
$11.96
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
NMFC
Sharpe Ratio:
0.69%
Comparison:
NMFC, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -14.36% lower than the industry
& is -69.79% lower than the market/S&P 500 average
Average Returns/Yield of
NMFC
Daily returns:
0.03%
Weekly returns:
0.14%
Monthly returns:
0.54%
Yearly returns:
9.18%
Comparison of returns:
Average annual returns/yield (last 3 years) is -28.81% below industry average
Classification:
NMFC, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.72
Statistical test of Returns:
NMFC has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.67%
Weekly Volatility:
5.97%
Monthly Volatility:
11.95%
Yearly Volatility:
41.38%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.29%
Volatility in last five trading days has been -51.54% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.46%
Weekly VaR:
-12.21%
Monthly VaR:
-24.41%
How Much Can the price of
NMFC
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-21%
Worst case (decline):
-84.56%
This translates to price declining to:
$10.18
This translates to price declining to:
$2.00
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
NMFC is a 72.29% riskier investment compared to the market/S&P 500 & is 47.60% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 2.79% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
NMFC
Beta in relation to market/S&P 500--1.21
Expected beta in 1 year's time:
0.746
Expected beta in 3 year's time:
1.054
Unlevered (debt free) Beta:
0.498
Beta in relation to Nasdaq (XNAS):
0.512
Beta in relation to all global stocks::
0.801
Beta Comparison & Analysis
Beta of competitors/peers::
0.813
Beta is 49.24% higher than peers
Average Industry Beta:
1.694
Beta is -28.38% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
7.85%
Sustainable growth rate is -72.14% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.049
Alpha is -11.63% below industry average alpha yield
Alpha is -313% below the market average
Analysis of Cost of Capital of
NMFC
Equity cost of capital:
0.115
Equity cost of capital is -22.32% below industry mean WACC
Unlevered (without debt) cost of capital:
4.70%
Before-tax cost of debt:
3.72%
After-tax cost of debt:
2.94%
Overall debt rating:
Upper medium A grade (third highest grade),CO8<=0.0429,"Medium BBB grade (Fourth highest grade)
Weighted average cost of capital (WACC):
2.94%
WACC is -11.26% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$2.57
Revenue growth rate per share of (3Y):
0.95
Annual revenue growth rate is -2.85% below industry average
EPS:
-$0.61
Expected Annual growth rate of EPS (3Y):
13.11%
Expected future EPS growth rate is -52.81% lower than the Asset Management industry
Free cash flow (FCF) per share:
-
Balance sheet equity growth per share: -11.26%
Equity growth rate per share is -153.27% lower than the industry
Debt per share
$19.29
EBITDA per share
$1.65
Valuation Analysis Today of
NMFC
P/E Ratio:
10.61
P/E Ratio of Competitors/Peers:
12.83
P/E ratio is -17.27% lower than main peers & is -34.28% lower than the industry
-
NMFC is -231.27% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $14.50
Present value of the expected future dividends only: $9.38
P/S (Price to Sales ratio):
5.03
Price to sales ratio is -26.55% below the industry mean
P/B (Price to book value ratio):
0.95
-
-
Net income growth rate (3Y):
118.55%
Net income growth rate is -18.46% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 15.31%
Dividend yeild: 9.28%
Previous Dividend: $0.30
Previous adjusted dividend: $0.30
Previous Dividend: $1.20
Expected next dividend best case: $0.31
Expected next dividend worst case: $0.29
Average dividend payment (long-term): $0.31
Average dividend increase/decrease (growth rate) % per period: -1.18%
Expected next dividend payment date: 28/09/2022
Expected next dividend record date: 14/09/2022
-
Previous dividend payment date: 30/06/2022
Previous dividend record date: 16/06/2022
-
Dividend History:
2022-06-15--$0.30
2021-12-15--$0.30
2021-06-15--$0.30
2022-03-16--$0.30
2021-09-15--$0.30
2021-03-16--$0.30
Dividend growth rate is -121.37% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
143.96%
Net debt to equity ratio:
141.34%
Debt to assets ratio:
57.78%
Net debt to assets ratio:
56.73%
Debt-to-asset ratio is 10.55% above industry average
Ability to repay debt:
Interest coverage ratio:
2.3
Interest coverage ratio is -96.14% less than industry average
Looking forward:
Debt growth rate:
-100.00%
Annual debt growth is 1346% higher than industry average debt growth rate
Debt repayment rate in last quarter: 4.99%
Analysis of Key Statistics
Correlation of price movement with the market:
0.461
Statistical significance of correlation:
NMFC has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.576
Stock price is -19.97% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.576
Correlation of price movement with Nasdaq (^IXIC):
0.037
Covariance of price movement with the market:
0.058
Kurtosis
27.957
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
-0.006
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
NMFC
Gross Profit Margin Ratio:
100%
Operating Profit Margin Ratio:
45.97%
Operating profit margin is -2.26% lower than the industry
Net Profit Margin Ratio:
100%
Effective Tax Rate:
0.11%
Effective tax rate is -99.55% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
13.79%
Return on equity (ROE) is -45.44% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
5.54%
Return on assets (ROA) is -5.13% lower than the industry
Financial Leverage:
2.4x
Current Ratio:
0
-
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 13.9 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
-
-
EBITDA generated per employee:
-
-
Profit generated per employee:
-
-
Free cash flow (FCF) generated per employee:
-
-
Assets/Capital per employee
-
-
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
NMFC
S & T BANCORP, INC. (XNAS:STBA)
LAKELAND BANCORP, INC. (XNAS:LBAI)
TRICO BANCSHARES (XNAS:TCBK)
SAFETY INSURANCE GROUP, INC. (XNAS:SAFT)
STONEX GROUP INC. (XNAS:SNEX)
1ST SOURCE CORPORATION (XNAS:SRCE)
BROOKLINE BANCORP, INC. (XNAS:BRKL)
AMERANT BANCORP INC. (XNAS:AMTB)
OAKTREE SPECIALTY LENDING CORPORATION (XNAS:OCSL)
Current Analyst Ratings
Strong buy�8%
Buy�0%
Hold�13%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
258.77M
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
-
121.03M
-
5.45M
9.91M
-
- 11041.00K
- 1134.00K
190.45M
72.35M
- 92386.00K
166.28M
118.96M
186.10M
192.59M
213.00K
186.10M
Statement of Cash Flow
Date:
Period:
-
Differed Income Tax :
-
Stock Based Compensation :
-
Change in Working Capital :
- 2698.00K
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
- 79519.00K
Net Cash Provided by Operating Activities:
- 45170.00K
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
35.38M
-
35.38M
34.76M
-
-
-
-
-
-
3.26B
-
-
-
3.36B
3.36B
12.20M
-
-
-
-
-
1.94B
-
1.94B
3.94B
1.99B
995.00K
54.07M
-
1.29B
March 31, 2022 at 6:00:00 AM
165.35M
1.35B
3.34B
-
1.94B
1.9B
-
-
-
- 102000.00K
20.47M
-
- 28491.00K
132.56M
22.55M
- 78.00K
- 22701.00K
35.38M
58.08M
- 45170.00K
-
- 45170.00K
Our Proprietary Portfolio Rating
Our Rating:
-
Price Forecast/Expected Price in Next 5 Years of
NMFC
2023
2024
2025
2026
2027
$14.05
$8.86
$9.58
$10.36
$11.21