This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Fifth Street Finance CEO Discusses F4Q2011 Results - Earnings Call Transcript

Stocks in this article: FSC

We expect to continue to grow this valuable relationship overtime. LIBOR plus 225 seven year money now allows us to cost effectively originate senior middle market assets. Our fourth quarter, net investment income of $0.28 per share was in the middle of the range of previously issued guidance. Going forward, we expect our earnings power to be better realized. As we have increased velocity in the portfolio, are starting to realize some of our equity investments and are collecting pre-payment penalties and exit fees on occasion, we have a much more efficient capital structure.

We also anticipate that part of the additional earnings will come from better matching our targeted leverage of 0.6 times debt-to-equity excluding the debt of the SBA, part will come from better utilization of our credit lines and part will come from re-allocating our 78% first lien, 22% second lien assets towards the more efficient capital lines for those securities whether it be our SBA, Sumitomo, Wells Fargo or ING led facilities. We continue to move into larger securities, which we believe are inherently safer with the typical investment having EBITDA between $10 million and $30 million. We believe that our high first lien exposure, coupled with investing in larger and more stable portfolio companies and our robust diligence in portfolio management process will result in greater portfolio stability should the economy pull back again.

At the same time, we feel comfortable that the decline in our weighted average yield to 12.35% at September 30, 2011 will stabilize now that we have reached our targeted portfolio mix. Alex Frank has been a great addition to our team this past quarter. His 22 years experience at Morgan Stanley culminating the role of Head of Global Operations gives Fifth Street assistance in three important areas; risk management, institutionalization operational growth and investor engagement.

Read the rest of this transcript for free on seekingalpha.com

3 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs