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Sound Point Meridian Capital, Inc.
(NYSE:SPMC)
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Rating:50Neutral
Price Target:
$9.00
â–¼(-2.39% Downside)
Action:Reiterated
Date:09/17/26
The score is primarily constrained by weak financial performance (sharp annual revenue/earnings deterioration and reduced equity) and bearish technicals (price below key moving averages with negative MACD). Offsetting factors include improved operating/free cash flow, a very high dividend yield, and corporate actions/results that may support near-term income (fee waiver and continued distributions), though realized-loss disclosures temper that support.
Positive Factors
Management fee waiver
The fee waiver directly lowers operating costs and allows shareholders to retain more of the portfolio’s investment income. Because the adviser will not be reimbursed for waived amounts, the benefit should support net investment income and distribution coverage during the waiver period.
Negative Factors
Severe earnings reversal
The sharp annual reversal in revenue and earnings materially weakens confidence in the stability and quality of the company’s earnings base. Persistently negative results would reduce internal capital formation, complicate distribution support, and make future performance more dependent on portfolio outcomes.
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Positive Factors
Negative Factors
Management fee waiver
The fee waiver directly lowers operating costs and allows shareholders to retain more of the portfolio’s investment income. Because the adviser will not be reimbursed for waived amounts, the benefit should support net investment income and distribution coverage during the waiver period.
Read all positive factors
Sound Point Meridian Capital, Inc. (SPMC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$173.74M
Dividend Yield32.73%
Average Volume (3M)22.65K
Price to Earnings (P/E)―
Beta (1Y)0.97
Revenue Growth15.28%
EPS Growth-805.67%
CountryUS
EmployeesN/A
SectorGeneral
Sector StrengthN/A
IndustryAsset Management
Share Statistics
EPS (TTM)-6.30
Shares Outstanding21,058,826
10 Day Avg. Volume24,549
30 Day Avg. Volume22,651
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)0.93
Price to Sales (P/S)-1.71
P/FCF Ratio27.44
Enterprise Value/Market Cap1.37
Enterprise Value/Revenue2.78
Enterprise Value/Gross Profit3.54
Enterprise Value/Ebitda-2.43
Forecast
1Y Price Target
$10.25Price Target Upside11.17% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)1.14
Revenue Forecast (FY)$52.49M
Sound Point Meridian Capital, Inc. Business Overview & Revenue Model
Company Description
Sound Point Meridian Capital, LLC functions as a closed-end investment firm based in the United States. The company's primary investment strategy involves allocating capital to the equity and mezzanine layers of collateralized loan obligations (CL...
Sound Point Meridian Capital, Inc. Earnings Call Summary
Earnings Call Date:May 27, 2026
(Q1-2027)
| % Change Since: |
Next Earnings Date:Nov 12, 2026
Earnings Call Sentiment Neutral
The call presented a mixed picture: the company reported GAAP profitability, unrealized gains and executed accretive portfolio rotations and liability refinancings, and management implemented cost-reduction steps (fee waiver). However, cash earnings (NII) remain below distributions, realized losses were material, and market headwinds—particularly AI-driven software stress, spread compression, reduced CLO issuance and a slowdown in private equity activity—are prominent and have driven a distribution cut. Management emphasized active portfolio management and tactical rotation into higher-yielding secondary positions as mitigation.Positive Updates
Net Investment Income and GAAP Net Income
Reported net investment income (NII) of $5.0 million, or $0.24 per share for the quarter ended 06/30/2026; GAAP net income of $17.5 million, or $0.83 per share.
Negative Updates
NII Below Cash Distributions and Distribution Cut
NII of $0.24 per share was below distributions paid during the quarter; subsequent to quarter end the board set monthly distributions for calendar Q4 2026 at $0.13 per share, down from the prior monthly rate of $0.20 per share (a ~35% reduction).
Read all updates
Q1-2027 Updates
Positive
Negative
Net Investment Income and GAAP Net Income
Reported net investment income (NII) of $5.0 million, or $0.24 per share for the quarter ended 06/30/2026; GAAP net income of $17.5 million, or $0.83 per share.
Read all positive updates
Company Guidance
Management guided to a lower dividend and temporary fee relief while outlining steps to restore NII: they set calendar Q4 2026 monthly distributions at $0.13/share (down from $0.20 in Q3) after reporting Q1 NII of $5.0M ($0.24/share) and $0.60/share of distributions during the quarter; NAV rose to $9.88 from $9.63 (estimated post‑quarter NAV $9.56–$9.66 as of 7/31/26). The adviser proposed a six‑month fee waiver (7/1/26–12/31/26) reducing the base fee from 1.75% to 1.5% and the incentive fee from 20% to 15% of pre‑incentive NII to help offset income compression; portfolio yield improved to 9.8% from 9.1% (management sees go‑forward yield ~10.1%), leverage was 45.7% of assets, total assets $384.7M, net assets $208.1M, portfolio fair value $363.2M, liquidity ~$21M. They emphasized active rotation and liability management (Q1 purchases: 13 investments cost $16.1M at 20.2% weighted yield; sales: 7 investments generated $23.3M at 8.5% yield; YTD rotation roughly $50M buys/$35M sells adding ~100 bps of yield), 13 CLO refis saving ~37 bps, Q1 realized loss $12.8M/unrealized gain $25.2M, total expenses $7.4M, GAAP net income $17.5M ($0.83/share), and a preference to deploy capital into secondary CLO equity (mid–high teens yields) versus primary (estimated 8–9%).Sound Point Meridian Capital, Inc. Financial Statement Overview
Summary
Income Statement
18
Very Negative
Balance Sheet
62
Positive
Cash Flow
44
Neutral
| Breakdown | Mar 2026 | Mar 2025 | Dec 2023 |
|---|---|---|---|
Income Statement | |||
| Total Revenue | -107.97M | 64.51M | 64.51M |
| Gross Profit | -121.96M | 64.39M | 64.39M |
| EBITDA | -126.23M | 63.60M | 63.60M |
| Net Income | -126.23M | 63.60M | 63.60M |
Balance Sheet | |||
| Total Assets | 374.53M | 303.21M | 303.21K |
| Cash, Cash Equivalents and Short-Term Investments | 5.81M | 4.99M | 4.99K |
| Total Debt | 60.00M | 70.00M | 0.00 |
| Total Liabilities | 175.83M | 9.05M | 9.05K |
| Stockholders Equity | 198.70M | 294.17M | 294.17K |
Cash Flow | |||
| Free Cash Flow | 6.73M | -106.38M | -106.38M |
| Operating Cash Flow | 6.73M | -106.38M | -106.38M |
| Investing Cash Flow | 0.00 | 0.00 | 0.00 |
| Financing Cash Flow | -10.87M | 85.46M | 85.46M |
Sound Point Meridian Capital, Inc. Technical Analysis
Negative
9.22
Price Trends
9.29
Negative
9.62
Negative
9.75
Negative
Market Momentum
-0.31
Positive
33.87
Neutral
41.17
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SPMC, the sentiment is Negative. The current price of 9.22 is above the 20-day moving average (MA) of 8.87, below the 50-day MA of 9.29, and below the 200-day MA of 9.75, indicating a bearish trend. The MACD of -0.31 indicates Positive momentum. The RSI at 33.87 is Neutral, neither overbought nor oversold. The STOCH value of 41.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SPMC.
Sound Point Meridian Capital, Inc. Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
60 Neutral | $210.91M | 20.33 | <0.01% | 29.91% | 138.32% | -27.91% | |
60 Neutral | $209.33M | 7.11 | 8.05% | 18.21% | 0.37% | -28.29% | |
60 Neutral | $333.93M | -3.14 | -17.68% | 19.05% | -141.00% | -809.18% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
54 Neutral | $69.17M | -1.56 | -32.53% | 23.35% | -11.06% | -288.02% | |
50 Neutral | $173.74M | -0.98 | -58.56% | 32.73% | 15.28% | -805.67% |
* General Sector Average
SPMC
Sound Point Meridian Capital, Inc.
8.25
-6.05
-42.32%
PNNT
Pennantpark Investment
3.21
-2.03
-38.72%
SCM
Stellus Capital
7.30
-3.44
-32.06%
TCPC
BlackRock TCP Capital
3.99
-0.87
-17.95%
GECC
Great Elm Capital
5.01
-1.70
-25.29%
Sound Point Meridian Capital, Inc. Corporate Events
Financial Disclosures
Sound Point Meridian Capital Reports Updated NAV Per Share
Neutral
Sep 8, 2026
As of August 31, 2026, Sound Point Meridian Capital, Inc. reported management’s unaudited estimate of its net asset value per share in a range between $9.52 and $9.62. This NAV disclosure provides investors with an updated indication of the ...
Business Operations and StrategyDividendsFinancial Disclosures
Sound Point Meridian Capital Reports Strong Quarterly Earnings
Positive
Aug 12, 2026
On August 3, 2026, Sound Point Meridian Capital entered into a Management Fee Waiver Agreement with its investment adviser, temporarily reducing the annual base management fee to 1.50% from 1.75% and lowering the incentive fee on pre-incentive net...
Financial Disclosures
Sound Point Meridian Capital Reports Q2 NAV and Income
Negative
Jul 15, 2026
As of June 30, 2026, Sound Point Meridian Capital, Inc. reported management’s unaudited estimate of net asset value per share in a range between $9.83 and $9.93, providing investors with an indication of the firm’s underlying portfolio...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.