Steven B. Klinsky, a director at New Mountain Finance Corp (NASDAQ:NMFC), has increased his holdings in the company by purchasing shares worth approximately $1.86 million. The transactions took place over two days, on November 4 and 5, 2024, with the stock prices ranging from $10.6801 to $10.7964 per share.
The purchases were made indirectly through various trusts, including the Steven B. Klinsky 2008 Long Term Trust and the Steven B. Klinsky 2024 Revocable Trusts. Following these transactions, Klinsky's total holdings in New Mountain Finance Corp amount to over 3.5 million shares, with the shares held across different trusts and family accounts.
Investors may note that these transactions reflect a significant increase in Klinsky's stake in the company, highlighting his confidence in New Mountain Finance Corp's future performance.
In other recent news, New Mountain Finance Corporation (NMFC) reported a strong Q3 performance, with an adjusted net investment income of $0.34 per share surpassing its regular dividend of $0.32 per share. The company also issued a supplemental dividend of $0.01 per share, set to be paid at the end of December. Despite a slight decrease in net asset value per share to $12.62, NMFC remains optimistic about the direct lending market and anticipates increased M&A activity in early 2025.
In addition to the earnings and revenue highlights, NMFC's investment strategy has led to a robust credit performance, with 97.3% of the portfolio rated green. The company's portfolio, primarily floating rate, holds strong against interest rate changes. Furthermore, NMFC plans to reduce Payment-in-Kind (PIK) exposure in 2025, replacing PIK repayments with new cash-oriented assets.
These recent developments indicate a positive direction for NMFC, with management holding approximately 12% of the company's shares, signifying a strong alignment with shareholder interests. However, the company did report a sequential decrease in dividends from the Senior Loan Program (SLP), attributed to timing rather than performance issues. Despite this, NMFC has returned over $1.3 billion to shareholders since its IPO, demonstrating its commitment to shareholder returns.
InvestingPro Insights
Steven B. Klinsky's recent substantial purchase of New Mountain Finance Corp (NASDAQ:NMFC) shares aligns with several key insights from InvestingPro. The company's stock is currently trading near its 52-week low, which may have presented an attractive entry point for the director. This timing is particularly interesting given that NMFC pays a significant dividend to shareholders, with a current dividend yield of 12.83%.
InvestingPro Tips highlight that NMFC has maintained dividend payments for 14 consecutive years, underscoring the company's commitment to returning value to shareholders. This consistency in dividend payments could be a factor in Klinsky's decision to increase his stake, especially considering the stock's current valuation.
The company's P/E ratio of 10.09 suggests a relatively modest valuation compared to the broader market. Additionally, NMFC has been profitable over the last twelve months, with a revenue of $373.51 million and an operating income of $285.31 million for the same period.
It's worth noting that while the stock has experienced negative price returns across various timeframes, including a -5.11% return over the past year, the RSI suggests the stock may be in oversold territory. This technical indicator, combined with the director's significant purchase, could signal a potential turnaround opportunity.
For investors seeking a more comprehensive analysis, InvestingPro offers additional tips and insights beyond those mentioned here. In fact, there are 8 more InvestingPro Tips available for NMFC, which could provide further context to the company's financial health and market position.
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