OFS Credit Company, Inc. (NASDAQ: OCCI) has announced a monthly dividend of $0.115 per share, scheduled for payment on February 27, 2024, to investors who hold shares as of February 13, 2024. This dividend yields an impressive 32.6%, attracting attention from both current and prospective investors.
The company’s dividend payout ratio stands at 173.3%, indicating reliance on its balance sheet to meet these payments, as earnings alone are insufficient to cover the dividend. Analysts project that OFS Credit will report earnings of $0.86 per share in the upcoming year, suggesting a potential inability to maintain its annual dividend of $1.49.
Market Performance and Investor Interest
On Wednesday, OFS Credit shares experienced a rise of 3.5%, trading up $0.15 to reach $4.24. The trading volume was approximately 299,051 shares, slightly below the average volume of 350,616. The stock has fluctuated between a 52-week low of $4.03 and a high of $7.32. Currently, the fifty-day simple moving average stands at $4.78, while the two-hundred-day moving average is at $5.17. The firm boasts a market capitalization of $66.70 million and a price-to-earnings ratio of -11.45, reflecting its current financial challenges.
A number of institutional investors have recently increased their stakes in OFS Credit. For instance, Raymond James Financial Inc. acquired a stake valued at approximately $26,000 in the second quarter, while TIAA Trust National Association and Kestra Private Wealth Services LLC made new investments valued at about $54,000 and $56,000, respectively. In total, hedge funds and institutional investors hold 23.77% of the company’s stock.
About OFS Credit
OFS Credit Company, Inc. is a closed-end, externally managed business development company focused on investing in senior secured loans to U.S. middle-market companies. As a registered investment company under the Investment Company Act of 1940, OFS Credit aims to generate current income and capital appreciation by providing first-lien and second-lien debt financing to privately held and sponsor-backed businesses. The company targets borrowers with stable cash flows and strong market positions across various sectors, including business services, healthcare, manufacturing, and technology.
OFS Credit’s investment portfolio is predominantly composed of floating-rate loan instruments and subordinated debt, supplemented by selective equity and equity-related securities. This diverse strategy positions the company to navigate market fluctuations while seeking to deliver value to its shareholders.
