HTGC - Hercules Capital, Inc.

NYSE - NYSE Delayed Price. Currency in USD
14.41
+0.04 (+0.28%)
At close: 4:02PM EST
Stock chart is not supported by your current browser
Previous Close14.37
Open14.41
Bid14.40 x 1000
Ask14.41 x 1200
Day's Range14.38 - 14.47
52 Week Range11.94 - 14.53
Volume417,909
Avg. Volume502,488
Market Cap1.508B
Beta (5Y Monthly)0.87
PE Ratio (TTM)12.77
EPS (TTM)N/A
Earnings DateN/A
Forward Dividend & Yield1.28 (8.91%)
Ex-Dividend DateNov. 05, 2019
1y Target EstN/A
  • Bloomberg

    Private-Debt Market Offers Rare 12% Yields, But There’s a Catch

    (Bloomberg) -- Scott Bluestein has a favorite type of debt investment: companies with no profits, no cash flow, and in some cases even no revenue.While that may seem like a recipe for disaster for most fixed-income money managers, it’s perfectly normal in the world of venture debt. And few companies in the space have been more successful in recent years than Bluestein’s Hercules Capital Inc., the largest nonbank lender in the business.The market for venture debt operates largely in the shadow of venture equity, the segment of startup financing famous for providing early funding for technology giants such as Facebook Inc. and Alibaba Group Holding Ltd. Winning wagers tend to not produce the sort of eye-popping payouts the equity side has become renowned for, but they’re also less risky, relatively speaking. Flying under the radar also has its benefits, according to Bluestein.While investors have plowed hundreds of billions of dollars into direct-lending funds over the past few years amid a global hunt for yield, the $15 billion venture debt market has yet to see the same influx of cash. As a result it’s largely avoided the intense competition, record dry powder and pricing pressures seen in other corners of private credit. In fact, the Hercules chief executive expects core loan yields to keep pace with the long-term average of about 12% going forward.“Venture debt has historically mystified the direct-lending market,” Bluestein said in an interview. “We have the opportunity to partner with and help finance some of the most exciting growth-stage technology and life-sciences companies in the world.”Hercules’s current borrowers include rare-disease drug developer BridgeBio Pharma Inc. and fake-meat producer Impossible Foods Inc.Lending to such companies requires a unique blend of credit, equity and industry expertise, according to Bluestein. The ability to assess why the companies are burning cash is critical.“Venture lending is a pretty esoteric, specialized part of the market,” Bluestein said. “It requires significant domain expertise. It requires an achievement of scale from a performance perspective.”Hercules originally provided BridgeBio a $35 million secured term loan in June 2018. The financing had grown to $75 million by the time BridgeBio went public a year later. Since then, its market capitalization has ballooned to $4.3 billion.As for Impossible Foods, Hercules closed a $50 million commitment in the second quarter of 2018. A year later, the meat-substitute company reached a $2 billion valuation. In both deals, Hercules made equity investments alongside the loans. In others, it often receives equity kickers in the form of stock warrants.Of course, the lender’s record isn’t spotless. Portfolio company Sungevity Inc. filed for bankruptcy in 2017, and the debt was subsequently converted into equity of the company that bought some of its assets. BIND Therapeutics Inc. went bust in 2016, though Hercules says it was able to fully recover its outstanding commitment.Last year, the company’s main challenge was unrelated to its investments. Founder and then-CEO Manuel Henriquez was forced to step aside after being charged by federal prosecutors in March for participating in the college-admissions cheating conspiracy.Wall Street was quick to cut its expectations for publicly-traded Hercules’s shares, worried that access to capital and origination growth may be hurt. The stock has since recovered, and the company said earlier this week it had surpassed more than $10 billion in committed debt capital since its inception in 2003. Assets under management stood at $2.3 billion as of Sept. 30.Niche PlayOthers are also growing in the space. Avenue Capital has sought to raise about $500 million for a venture debt fund, Reuters reported in November. Specialty lenders in the business also include TriplePoint and Horizon Technology Finance, while Silicon Valley Bank is seen as an industry pioneer.Still, the strategy isn’t for everyone. Direct-lending giant Ares Capital Corp. exited the space in 2017, offloading its $125 million portfolio of venture loans to Hercules. CEO Kipp deVeer at the time attributed the exit to the overwhelming challenge of overseeing so many small and complicated financings.Along with being relatively small, maturities on the loans tends to be short. That makes for a fast-churn, research-intensive business. The average tenor of a Hercules loans is 36 to 48 months, but the actual average duration is just a year-and-a-half, according to Bluestein.“Our portfolio turns about every 18 months,” Bluestein said. “The treadmill is set at 10, and you can’t stop.”While recent high-profile venture-capital stumbles such as WeWork may make investors wary of startup financing broadly, Bluestein welcomes the greater scrutiny and caution, acknowledging there have been a number of so-called unicorns where valuations reached extreme levels.“It’s a positive. It puts more focus on fundamentals,” Bluestein said. “Anything that makes the market more realistic is good for business.”(Updates with Hercules assets under management in 13th paragraph.)\--With assistance from Lisa Abramowicz.To contact the reporter on this story: Lisa Lee in New York at llee299@bloomberg.netTo contact the editors responsible for this story: Natalie Harrison at nharrison73@bloomberg.net, Adam Cataldo, Boris KorbyFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Loan Originations, Solid Liquidity Aid Hercules Capital (HTGC)
    Zacks

    Loan Originations, Solid Liquidity Aid Hercules Capital (HTGC)

    Hercules Capital (HTGC) remains well-positioned for growth based on its strong liquidity position, improving economy and robust loan originations.

  • Top Ranked Income Stocks to Buy for November 29th
    Zacks

    Top Ranked Income Stocks to Buy for November 29th

    Top Ranked Income Stocks to Buy for November 29th

  • Asset Growth Aids BlackRock's Top Line Despite High Costs
    Zacks

    Asset Growth Aids BlackRock's Top Line Despite High Costs

    While solid AUM balance is expected to support BlackRock's (BLK) revenue growth, higher costs will likely hurt the bottom line.

  • 4 Reasons to Add Hercules Capital (HTGC) to Your Portfolio
    Zacks

    4 Reasons to Add Hercules Capital (HTGC) to Your Portfolio

    Given the earnings strength and favorable operating backdrop, Hercules Capital (HTGC) stock seems to be an attractive investment option.

  • Here's Why it is Best to Hold Commerce Bancshares Stock Now
    Zacks

    Here's Why it is Best to Hold Commerce Bancshares Stock Now

    Loan growth will likely continue aiding Commerce Bancshares' (CBSH) revenues. Yet, persistently increasing costs may hurt its bottom line.

  • Top Ranked Income Stocks to Buy for November 19th
    Zacks

    Top Ranked Income Stocks to Buy for November 19th

    Top Ranked Income Stocks to Buy for November 19th

  • Thomson Reuters StreetEvents

    Edited Transcript of HTGC earnings conference call or presentation 30-Oct-19 9:00pm GMT

    Q3 2019 Hercules Capital Inc Earnings Call

  • TriplePoint (TPVG) Stock Falls on Q3 Earnings Miss, Costs Up
    Zacks

    TriplePoint (TPVG) Stock Falls on Q3 Earnings Miss, Costs Up

    Fall in revenues and higher expenses hurt TriplePoint's (TPVG) third-quarter 2019 results.

  • Top Ranked Income Stocks to Buy for November 8th
    Zacks

    Top Ranked Income Stocks to Buy for November 8th

    Top Ranked Income Stocks to Buy for November 8th

  • FS KKR Capital's (FSK) Q3 Earnings Beat on Higher Revenues
    Zacks

    FS KKR Capital's (FSK) Q3 Earnings Beat on Higher Revenues

    Surge in revenues supports FS KKR Capital's (FSK) Q3 earnings. Higher costs act as a headwind.

  • Prospect Capital (PSEC) Q1 Earnings In Line, Costs Down Y/Y
    Zacks

    Prospect Capital (PSEC) Q1 Earnings In Line, Costs Down Y/Y

    While fall in expenses support Prospect Capital's (PSEC) Q1 earnings, decline in total investment income and investment portfolio value hurt to some extent.

  • LendingClub (LC) Stock Gains on Q3 Earnings & Revenue Beat
    Zacks

    LendingClub (LC) Stock Gains on Q3 Earnings & Revenue Beat

    Improvement in top line supports LendingClub's (LC) Q3 earnings. Also, upbeat fourth-quarter 2019 guidance drives the stock up 11.6%.

  • Newtek (NEWT) Q3 Earnings Beat on Higher Investment Income
    Zacks

    Newtek (NEWT) Q3 Earnings Beat on Higher Investment Income

    Higher total investment income boosts Newtek's (NEWT) Q3 earnings, partly muted by escalating costs.

  • What's in the Cards for Main Street (MAIN) in Q3 Earnings?
    Zacks

    What's in the Cards for Main Street (MAIN) in Q3 Earnings?

    Main Street's (MAIN) third-quarter 2019 results are expected to reflect fall in interest income due to lower rates.

  • What to Expect From Newtek Business (NEWT) in Q3 Earnings
    Zacks

    What to Expect From Newtek Business (NEWT) in Q3 Earnings

    Newtek Business' (NEWT) third-quarter 2019 results are expected to reflect the adverse impact of an expected fall in investment income.

  • Hercules Capital (HTGC) Q3 Earnings Beat on Higher Revenues
    Zacks

    Hercules Capital (HTGC) Q3 Earnings Beat on Higher Revenues

    Hercules Capital (HTGC) witnesses higher total investment income along with rise in expenses in the third quarter of 2019.

  • Ares Capital (ARCC) Beats on Q3 Earnings Despite Higher Costs
    Zacks

    Ares Capital (ARCC) Beats on Q3 Earnings Despite Higher Costs

    Ares Capital (ARCC) witnesses higher total investment income along with rise in costs in the third quarter of 2019.

  • Hercules Technology (HTGC) Beats Q3 Earnings and Revenue Estimates
    Zacks

    Hercules Technology (HTGC) Beats Q3 Earnings and Revenue Estimates

    Hercules Tech (HTGC) delivered earnings and revenue surprises of 8.82% and 2.53%, respectively, for the quarter ended September 2019. Do the numbers hold clues to what lies ahead for the stock?

  • Hercules Technology (HTGC) Earnings Expected to Grow: What to Know Ahead of Next Week's Release
    Zacks

    Hercules Technology (HTGC) Earnings Expected to Grow: What to Know Ahead of Next Week's Release

    Hercules Tech (HTGC) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

  • Thomson Reuters StreetEvents

    Edited Transcript of HTGC earnings conference call or presentation 1-Aug-19 9:00pm GMT

    Q2 2019 Hercules Capital Inc Earnings Call

  • Why Is Hercules Tech (HTGC) Up 2% Since Last Earnings Report?
    Zacks

    Why Is Hercules Tech (HTGC) Up 2% Since Last Earnings Report?

    Hercules Tech (HTGC) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.

  • Prospect Capital (PSEC) Q4 Earnings Lag on Lower Revenues
    Zacks

    Prospect Capital (PSEC) Q4 Earnings Lag on Lower Revenues

    Decline in revenues and lower investment portfolio value hurt Prospect Capital's (PSEC) fiscal Q4 earnings.

  • Main Street (MAIN) Q2 Earnings Beat Estimates, Revenues Rise
    Zacks

    Main Street (MAIN) Q2 Earnings Beat Estimates, Revenues Rise

    Increase in total investment income and a strong balance sheet position support Main Street's (MAIN) Q2 earnings.

  • FS KKR Capital's (FSK) Q2 Earnings Beat, Revenues Jump Y/Y
    Zacks

    FS KKR Capital's (FSK) Q2 Earnings Beat, Revenues Jump Y/Y

    Increase in total investment income supports FS KKR Capital's (FSK) Q2 earnings.