Hercules Capital (HTGC) Outperforms Market: Key Metrics and Analyst Forecast to Watch
In the latest closed session, Hercules Capital (HTGC) saw its stock price rise by +1.57%, closing at $18.08. This outpaced the S&P 500's 1.11% gain on the day, as well as the Dow's 1.19% increase and the Nasdaq's 1.43% addition.
The specialty finance company's stock has risen by 2.3% in the past month, leading the Finance sector's gain of 1.91% and undershooting the S&P 500's gain of 3.92%.
Investment Community Awaits Earnings Report
The investment community is closely monitoring Hercules Capital's forthcoming earnings report. The company is expected to report EPS of $0.47, a decrease of 7.84% from the prior-year quarter. In the meantime, our current consensus estimate forecasts revenue to be $126.4 million, indicating a 1.11% growth compared to the corresponding quarter of the prior year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $1.91 per share and revenue of $509.95 million. These totals would mark changes of -4.5% and +3.31%, respectively, from last year.
Analyst Forecast Revisions and Zacks Rank
Investors should keep an eye on any recent revisions to analyst forecasts for Hercules Capital. These revisions typically reflect the latest short-term business trends, which can change frequently. Positive alterations in estimates signify analyst optimism regarding the business and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, there's been a 0.21% rise in the Zacks Consensus EPS estimate. Currently, Hercules Capital is carrying a Zacks Rank of #4 (Sell).
Valuation and Industry Rank
In terms of valuation, Hercules Capital is presently being traded at a Forward P/E ratio of 9.32, which is a premium compared to the average Forward P/E of 8.61 of its industry.
The Financial - SBIC & Commercial Industry industry is part of the Finance sector and currently holds a Zacks Industry Rank of 228, placing it within the bottom 8% of over 250 industries. The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
In conclusion, while Hercules Capital's stock has shown recent gains, investors should remain cautious given its current Zacks Rank and valuation metrics. It will be interesting to see how the company performs in its upcoming earnings report and how that affects its stock price in the coming sessions.
You can find more information on all of these metrics and much more on Zacks.com. For the latest recommendations from Zacks Investment Research, download their free report on Hercules Capital, Inc. (HTGC) today.
