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Hercules Reports Solid Q1 Originations; Gives 2015 Target - Analyst Blog

Hercules Technology Growth Capital, Inc.HTGC released its portfolio update for first-quarter 2015, which continued to reflect sturdy loan origination performance. The robust pipeline will likely support the company's target to achieve growth of around 30-50% throughout 2015 and reach the year-end goal of $1.3-$1.5 billion.

The leading specialty finance company's achievement for the stated quarter mainly involved six IPO registrations and three IPO completions to facilitate liquidity requirements as well as seven new commitments.

1Q15 Origination Activities in Detail

As of Mar 16, 2015, Hercules recorded $170.0 million worth of debt and equity commitments to new and existing portfolio companies. Of these, $35.0 million worth of debt and equity commitments as well as renewals were made to existing portfolio companies.

The new commitments made by the company mainly involved venture capital-backed companies in the growth stage. Around $36.0 million was invested in technology companies and about $99.0 million was invested in the life science portfolio.

Other Liquidity Events

Hercules' first quarter portfolio update included several liquidity events such as IPOs registration and completion to capitalize on the evolving technology sector. As of Mar 16, 2015, Hercules held warrant and equity positions in six portfolio companies including Good Technology and ViewRay Incorporated.

Hercules completed the IPO of three of its portfolio companies - Box, Inc. BOX , Zosano Pharma Corporation ZSAN and Inotek Pharmaceuticals Corporation ITEK during the quarter.

Apart from these liquidity activities, Hercules continued trimming and rebalancing its investment portfolios. Further, as of Mar 16, 2015, Hercules received roughly $50.5 million in principal repayments comprising around $23.0 million worth of unscheduled early repayments.

Moreover, as of Mar 16, 2015, Hercules held unfunded debt commitments of around $343.6 million, exhibiting potential future portfolio growth.

Overall, Hercules' enhanced first-quarter portfolio update continued the strong origination activities visible in the previous year and set the momentum for this year's targeted growth. This commendable development in originations activities will propel the company's top-line growth, which may be reflected in the upcoming quarterly results.

Currently, Hercules carries a Zacks Rank #5 (Strong Sell).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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