New Mountain (NMFC) 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.

New Mountain (NMFC) delivered earnings and revenue surprises of -8.57% and -3.37%, respectively, for the quarter ended December 2019. Do the numbers hold clues to what lies ahead for the stock?

Putting together a strong portfolio is more an art than a science. You have to balance share appreciation, potential upside, fundamental strength, and dividend yield to find the stock that will meet your needs. Do you want your investments to pay for themselves right away, or do you prefer a steady long-term gain? These are just a few of the factors to consider.It’s complicated by the sheer size of the stock markets. TipRanks tracks data on over 6,500 publicly traded stocks – and that’s just the tip of the iceberg. Fortunately, the Stock Screener tool makes it easy to find the right investment. Set the filters to sort out the stocks with a “Strong Buy” consensus rating, add in ‘very high’ dividend yields, above 5%, and you’ll get the list down to only a handful of names. Here are three of them that may be worth your attention.Enterprise Products Partners LP (EPD)The oil and gas midstream sector – that is, the companies that move the product between the wellheads, storage farms, terminals, and the customers – is a profitable niche. The companies here control pipelines, railroad assets, river barges, terminals, and storage tanks, as well as make it possible to move fossil fuels. Enterprise Products owns and operates 50,000 miles of such pipelines, and controls storage capacity for 160 million barrels of oil and 14 billion cubic feet of natural gas. Enterprise also holds import/export terminal facilities on the Gulf Coast of Texas.Low prices for oil and gas in 2019 hurt the company’s bottom line last year, but EPD appears to be holding up well. Even though the Q3 numbers missed the estimates, Q4, reported last week, was strong. Revenue came in above the forecast, at $8.01 billion, while the EPS of 54 cents was in-line with expectations. Both numbers are down year-over-year but up sequentially.Enterprise is committed to sharing profits with investors, and pays out a regular – and reliable – dividend. With a yield of 7%, the dividend provides a return more than three times higher than the S&P 500 average, while the 81% payout ratio indicates that it is sustainable for the company. EPD’s history of dividend reliability goes back over 10 years.5-star analyst TJ Schultz, of RBC Capital, sees EPD as a solid choice for investors. He writes, “EPD offers investors broad exposure to a full spectrum of the midstream value chains for NGLs and, increasingly, crude and petrochemical products. Furthermore, the partnership's multi-year organic growth backlog helps provide visibility on long-term distribution growth. EPD has grown and should continue to grow its fee-based cash flows as announced projects enter service and ramp.”Schultz puts a $36 price target on EPD, implying an impressive upside potential of 41%, to back up his Buy rating on the stock. (To watch Schultz’s track record, click here)Overall, EPD gets a Strong Buy from the analyst consensus, and that rating is unanimous. The stock has received 7 buy ratings in recent weeks. Shares are a bargain considering the high yield, priced at $25.56. The average price target of $34.50 suggests room for an upside of 35%. (See Enterprise Products stock analysis on TipRanks) Kimbell Royalty Partners LP (KRP)Kimbell Royalty is another player in the Texas oil boom, operating at the source. Kimbell owns oil and gas operations in 28 states, with major exploration, drilling, and extraction activity in the Permian Basin and Eagle Ford areas of Texas, North Dakota’s Bakken formation, and across Appalachia. Kimbell’s largest area of activity, which includes 43% of the company’s active wells, is in the Permian Basin of Texas.Where Enterprise, above, saw a tough time in 2H19, Kimbell posted record high revenue in Q3 of that year. The top line came in with a 79% year-over-year gain, to $33 million. In addition to high revenues, KRP was able to acquire two competing companies, Haymaker and Phillips, during the reporting period.Even better for investors, KRP has been using its positive cash flow generation to maintain a strong dividend. The company’s quarterly payment, 38 cents, annualizes to $1.52, for an impressive yield of 11.1%. That’s more than five times the average yield among S&P listed companies, and is powerful incentive for investors.Looking at Kimbell for KeyBanc, analyst Leo Mariani was impressed enough by the company’s performance to initiate coverage with a Buy rating. He cites, “…anticipated dividend increases in 2020 and the recent pullback in the shares…” as reasons to enter this stock.Mariani gives KRP an $18 price target to back the Buy rating, seeing room for 31% share growth here. (To watch Mariani’s track record, click here)The Strong Buy consensus view on KRP shares is bolstered by 8 recent reviews, including 7 Buys and 1 Hold. The stock sells for just $13.70, and the average price target of $20.14 suggests an upside potential of 47%. (See Kimbell stock analysis on TipRanks) New Mountain Finance Corporation (NMFC)The energy industry isn’t the only place to find great dividend yields. Investment management companies, which control and administer private and corporate investment portfolios for profit, by nature generate a high cash flow. New Mountain uses its cash flow to maintain a dividend, returning profits to investors.The dividend here is definitely worth talking about. NMFC pays out 34 cents per quarter, and has done so consistently since 2013. This gives a yield of 9.6% and an annualized payment of $1.36. The payout ratio is 98%, indicating that New Mountain returns all of its profits to investors – as expected, in an investment management company.Like Kimbell, above, New Mountain has attracted a new analyst thanks to its solid financial performance. Derek Hewett, from Merrill Lynch, writes in support of his Buy rating, “We see an attractive dividend yield, and believe New Mountain is well positioned to capitalize on a supply/demand imbalance in the unrated middle market.”Hewett’s price target, $14.50, suggests a modest upside of 2% in a stock that has already shown 4% appreciation so far this year. (To watch Hewett’s track record, click here)With 3 recent Buy reviews, NMFC’s Strong Buy analyst consensus rating is unanimous. The stock offers a low cost of entry, at $14.23, and the average price target of $14.58 implies room for another 2.5% growth. The real benefit here is the dividend return. (See New Mountain stock analysis on TipRanks)

New Mountain (NMFC) 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.

Q1 2020 New Mountain Finance Corp Earnings Call

NMFC earnings call for the period ending March 31, 2020.

New Mountain Finance Corporation today announced its financial results for the quarter ended March 31, 2020 and reported first quarter net investment

NEW YORK--(BUSINESS WIRE)--New Mountain Finance Corporation today announced its financial results for the quarter ended March 31, 2020 and reported first quarter net investment

New Mountain (NMFC) delivered earnings and revenue surprises of 3.03% and -4.67%, respectively, for the quarter ended March 2020. Do the numbers hold clues to what lies ahead for the stock?

Q3 2019 New Mountain Finance Corp Earnings Call

A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period […]

NMFC Shareholder Letter regarding COVID-19 impact.

Q4 2019 New Mountain Finance Corp Earnings Call

The average BDC in the BDC sector must lose 25% of its portfolio value before a debt covenant is broken.We will only start seeing Non-Accrual loans being mentioned in financial statements when BDCs report the third-quarter earnings of this year.I believe that…

The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 700 world-class investment firms that we track and now have access to the collective wisdom contained in […]

New Mountain (NMFC) delivered earnings and revenue surprises of -2.86% and 4.20%, respectively, for the quarter ended September 2019. Do the numbers hold clues to what lies ahead for the stock?

Hedge funds don't get the respect they used to get. Nowadays investors prefer passive funds over actively managed funds. One thing they don't realize is that 100% of the passive funds didn't see the coronavirus recession coming, but a lot of hedge funds did. …

Members of the Cuban medical brigade will be deployed to hospitals across the province where they will work alongside KZN medical teams fighting against the spread of Covid-19.

NEW YORK, May 11, 2020 /PRNewswire/ -- WhiteHorse Finance, Inc. ("WhiteHorse Finance" or the "Company") (Nasdaq: WHF) today announced its financial results for the quarter ended March 31, 2020. First Quarter 2020 Summary Highlights Net Asset Value of $284.7 m…

New Mountain (NMFC) 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.

On the line with me here today are Steve Klinsky, Chairman of NMFC and CEO of New Mountain Capital; John Kline, President and COO of NMFC; and Shiraz Kajee, CFO of NMFC. Before diving into the business update, we do want to recognize that we are living in a public health crisis that is taking a significant human toll on our communities across our country and around the globe.

Insiders invest in OPKO Health, Eli Lilly, Wesbanco, New Mountain Finance and Hersha Hospitality Continue reading...

New Mountain Finance Corporation Schedules Its First Quarter 2020 Earnings Release and Dividend Announcement

(Bloomberg) -- Business development companies, the most visible pocket of the $800 billion private credit market, face more dividend cuts and possibly even restructurings later this year after the Covid-19 pandemic has bruised their portfolios.The companies this month released results for the quarter ended March 31, and the industry saw steep drop-offs in the value of investments and other headwinds caused by the new coronavirus. BDCs that wrote down the loans they own by about 6.5% ended up posting declines in their net asset value per share ranging between 6% and 30%, according to JMP Securities analyst Christopher York.Those writedowns make it harder for the companies to continue paying out as much to investors, York said. More than a dozen BDCs, including FS KKR Capital Corp. and New Mountain Finance Corp., slashed their dividend payments recently.In July, ahead of the next round of earnings “you may see some other BDCs that haven’t done so reduce their dividends,” York said in an interview. Lower dividends can punish BDCs, whose shareholders are often seeking income. BDC share prices fell an average of around 45% in the first quarter on investors’ expectations of dividend cuts.Requests for comment from FS KKR and New Mountain weren’t immediately returned.Managing LiabilitiesIn focus for many market watchers is how BDCs are contending with their own debt loads. Capitala Finance Corp., for example, said in early May it couldn’t draw on its senior secured credit facility due to its non-compliance with covenants.In an email, Capitala Chief Executive Officer Joseph Alala said the BDC has sufficient liquidity, due to its $55 million in cash and a new small business investment company license that allows it to borrow up to $175 million from the U.S. Small Business Administration at maximum leverage with funded equity.Ryan Lynch, an analyst at Keefe, Bruyette & Woods, scrutinized BDCs’ financials to evaluate how well the companies could weather the pandemic. Those that will fare best, according to Lynch, are those that have the lowest leverage; with the highest percentage of liabilities in unsecured debt, which provide more financial flexiblity; that have a high level of undrawn credit facility capacity and lower amounts of unfunded commitments.“That puts you in a better position to not only survive this downturn but also to take advantage of deals at the bottom,” Lynch said.For the second quarter, analysts will be watching to see how much portfolios recover from mark-to-market losses. Investors may be even less forgiving than they were for the first quarter.“I think the scrutiny will kick up in the second quarter,” said Richard Wheelahan, a founding partner at debt advisory firm Fund Finance Partners. “Extrapolate the themes from Q1 and increase the order of magnitude.”Investors will watch results closely for signs of more losses brewing in companies’ portfolios. This trend could play out over the rest of the year, said JMP’s York.“The second quarter you should see significant accelerations in non-accrual investment and then in the third quarter you should expect to see some restructures -- that will be the sequence,” York said.For 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.