Oppenheimer downgrades BlackRock TCP Capital to Perform following Q4 results

As previously reported, Oppenheimer analyst Mitchell Penn downgraded BlackRock TCP Capital to Perform from Outperform with a price target of $11, down from $13, following quarterly results. The firm notes that in Q4, BlackRock TCP Capital lost 23c/share, equating to a -7.4% ROE as it generated net losses of $38.4M,or 67c/share, primarily driven by credit-specific marks on Edmentum, Thras.io, and Aventiv Technologies. Oppenheimer estimates that BlackRock will earn $1.71/share and $1.61/share in 2024 and 2025, respectively, for an ROE of 14.2% and 13.0% before credit losses. The firm is also lowering its expected ROE to 9%, slightly above its ROE since IPO, which lowers our fairvalue by $2/share to $11/share.