New Mountain Finance (NMFC) Q3 2025 Earnings Call Transcript
Adjusted Net Investment Income $0.32 per share, covering the $0.32 per share dividend paid in cash on September 30. Supported by consistent recurring income from the loan portfolio, full utilization of the dividend protection program, and an incremental fee waiver.
Net Asset Value (NAV) per share Declined $0.15 compared to Q2, to $12.06. Decline attributed to modest decreases across four investments.
Stock Repurchase Program $47 million worth of shares repurchased this year at an average price of approximately $10. Fully utilized the $50 million 10b5-1 stock repurchase program. A new $100 million share buyback program has been approved.
Portfolio Loan-to-Value Stands at 45%. Reflects a defensive growth strategy in sectors like healthcare, IT software, insurance services, and infrastructure services.
Nonaccruals $51 million or 1.7% of the portfolio on nonaccrual at fair value. Includes a first lien debt position in Beauty Industry Group moved to nonaccrual status due to weaker consumer demand, go-to-market challenges, and tariffs on its China-oriented supply chain.
Total Investment Income $80 million for the quarter, a 4% decrease compared to the prior quarter. Driven by strong core income and effective incentive fee rate of 7.6%.
Portfolio Yield Decreased slightly to 10.4% due to lower yields on originations compared to repayments as the portfolio continues to rotate more senior.
Weighted Average EBITDA of Portfolio Companies Increased slightly to $180 million due to growth at individual companies and realization of smaller companies during the quarter.
Net Debt-to-Equity Ratio 1.23:1, within the target range of 1:1.25.
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New Mountain Capital Closes $1.2 Billion Private Equity Fund
- Fund Size Achievement: New Mountain Capital announced the successful closing of its second non-control private equity fund, New Mountain Strategic Equity Fund II (SEF II), at $1.2 billion, exceeding its $1 billion hard cap due to strong investor demand.
- Investment Focus: SEF II will concentrate on minority investments in defensive growth sectors such as infrastructure services, life sciences, and advanced materials, aiming to drive business development and value creation through non-control transactions.
- Diverse Investor Base: The fund's investors include pensions, insurance companies, asset managers, endowments, family offices, and high-net-worth individuals, reflecting broad market confidence and recognition of New Mountain Capital's strategic approach.
- Asset Management Scale: New Mountain Capital currently manages approximately $60 billion in assets across private equity, strategic equity, credit, and net lease real estate funds, with a team of over 300 professionals, continuously enhancing its research and underwriting capabilities in defensive growth sectors.
Upcoming Sale of New Mountain Assets Serves as a Benchmark for Private Credit Market
- Potential Asset Sale: New Mountain Finance is considering a $500 million sale of assets, which could significantly impact its operations.
- Market Implications: This move is seen as a critical test for the business-development company and the broader private credit market, valued at $1 trillion and currently facing scrutiny.
This Stock Offers a 13.18% Yield and is Priced Below Its Book Value
Dividend Investment Strategy: Dividend investors focus on identifying profitable companies that are attractively valued, utilizing a proprietary DividendRank formula to generate a list of promising stocks for further research.
New Mountain Finance Corporation Dividend: NMFC currently pays an annualized dividend of $1.28 per share, distributed quarterly, with the next ex-dividend date set for December 17, 2025.
Importance of Dividend History: Analyzing a company's past dividend history is crucial for assessing the likelihood of continued dividend payments.
Author's Perspective: The views expressed in the report are those of the author and do not necessarily represent the opinions of Nasdaq, Inc.
New Mountain Finance announces a dividend of $0.32
Dividend Declaration: New Mountain Finance (NMFC) has declared a quarterly dividend of $0.32 per share, consistent with previous payouts.
Dividend Details: The dividend is payable on December 31, with shareholders of record on December 17, and the ex-dividend date also on December 17.
Yield Information: The forward yield for NMFC stands at 13.21%.
Growth Prospects: There are concerns regarding NMFC's growth prospects, with a noted lack of coverage for its dividend yield and upcoming earnings preview for Q3 2025.
New Mountain Finance Corporation Reports Q3 Financial Results for the Period Ending September 30, 2025
Financial Performance: New Mountain Finance Corporation reported a net investment income of $33.9 million ($0.32 per share) for Q3 2025, with a slight decrease in net asset value to $12.06 per share compared to the previous quarter.
Portfolio Composition: Approximately 95% of the company's investment portfolio is rated green, with a focus on senior-oriented assets increasing to 80% as of September 30, 2025.
Stock Repurchase Plans: The company completed its original $50 million stock repurchase plan and has established a new plan allowing for the repurchase of up to $100 million in common shares.
Future Initiatives: New Mountain Finance is exploring a secondary portfolio sale of up to $500 million in assets to enhance financial flexibility and diversify its portfolio.
Mountain Finance Q3 2025 Earnings Outlook
Earnings Announcement: New Mountain Finance (NMFC) will announce its Q3 earnings on November 3rd, with an expected EPS of $0.32 and revenue of $83.66 million.
Estimate Revisions: Over the past three months, EPS estimates have seen one downward revision, while revenue estimates have experienced one upward and four downward revisions.
Dividend Yield: NMFC maintains a dividend of $0.32, offering a 12.7% yield, although concerns exist regarding its coverage and growth prospects.
Portfolio Management: The company is focusing on improving portfolio quality and has plans for debt refinancing to enhance its financial position.
New Mountain Capital Closes $1.2 Billion Private Equity Fund
- Fund Size Achievement: New Mountain Capital announced the successful closing of its second non-control private equity fund, New Mountain Strategic Equity Fund II (SEF II), at $1.2 billion, exceeding its $1 billion hard cap due to strong investor demand.
- Investment Focus: SEF II will concentrate on minority investments in defensive growth sectors such as infrastructure services, life sciences, and advanced materials, aiming to drive business development and value creation through non-control transactions.
- Diverse Investor Base: The fund's investors include pensions, insurance companies, asset managers, endowments, family offices, and high-net-worth individuals, reflecting broad market confidence and recognition of New Mountain Capital's strategic approach.
- Asset Management Scale: New Mountain Capital currently manages approximately $60 billion in assets across private equity, strategic equity, credit, and net lease real estate funds, with a team of over 300 professionals, continuously enhancing its research and underwriting capabilities in defensive growth sectors.
Upcoming Sale of New Mountain Assets Serves as a Benchmark for Private Credit Market
- Potential Asset Sale: New Mountain Finance is considering a $500 million sale of assets, which could significantly impact its operations.
- Market Implications: This move is seen as a critical test for the business-development company and the broader private credit market, valued at $1 trillion and currently facing scrutiny.
This Stock Offers a 13.18% Yield and is Priced Below Its Book Value
Dividend Investment Strategy: Dividend investors focus on identifying profitable companies that are attractively valued, utilizing a proprietary DividendRank formula to generate a list of promising stocks for further research.
New Mountain Finance Corporation Dividend: NMFC currently pays an annualized dividend of $1.28 per share, distributed quarterly, with the next ex-dividend date set for December 17, 2025.
Importance of Dividend History: Analyzing a company's past dividend history is crucial for assessing the likelihood of continued dividend payments.
Author's Perspective: The views expressed in the report are those of the author and do not necessarily represent the opinions of Nasdaq, Inc.
New Mountain Finance announces a dividend of $0.32
Dividend Declaration: New Mountain Finance (NMFC) has declared a quarterly dividend of $0.32 per share, consistent with previous payouts.
Dividend Details: The dividend is payable on December 31, with shareholders of record on December 17, and the ex-dividend date also on December 17.
Yield Information: The forward yield for NMFC stands at 13.21%.
Growth Prospects: There are concerns regarding NMFC's growth prospects, with a noted lack of coverage for its dividend yield and upcoming earnings preview for Q3 2025.
New Mountain Finance Corporation Reports Q3 Financial Results for the Period Ending September 30, 2025
Financial Performance: New Mountain Finance Corporation reported a net investment income of $33.9 million ($0.32 per share) for Q3 2025, with a slight decrease in net asset value to $12.06 per share compared to the previous quarter.
Portfolio Composition: Approximately 95% of the company's investment portfolio is rated green, with a focus on senior-oriented assets increasing to 80% as of September 30, 2025.
Stock Repurchase Plans: The company completed its original $50 million stock repurchase plan and has established a new plan allowing for the repurchase of up to $100 million in common shares.
Future Initiatives: New Mountain Finance is exploring a secondary portfolio sale of up to $500 million in assets to enhance financial flexibility and diversify its portfolio.
Mountain Finance Q3 2025 Earnings Outlook
Earnings Announcement: New Mountain Finance (NMFC) will announce its Q3 earnings on November 3rd, with an expected EPS of $0.32 and revenue of $83.66 million.
Estimate Revisions: Over the past three months, EPS estimates have seen one downward revision, while revenue estimates have experienced one upward and four downward revisions.
Dividend Yield: NMFC maintains a dividend of $0.32, offering a 12.7% yield, although concerns exist regarding its coverage and growth prospects.
Portfolio Management: The company is focusing on improving portfolio quality and has plans for debt refinancing to enhance its financial position.
