Tuesday, JMP Securities initiated coverage on Nuveen Churchill Direct Lending Corp (NYSE:NCDL) with a Market Perform rating. The firm highlighted the company's recent initial public offering (IPO), which, including the 15% greenshoe option, raised approximately $100 million on January 24, 2024. Nuveen Churchill Direct Lending is now among seven Business Development Companies (BDCs) with a market capitalization over $1 billion within JMP Securities' coverage universe.
The analyst noted that Nuveen Churchill Direct Lending has established itself as a scaled and diversified publicly traded direct lending vehicle. The company's ability to raise substantial capital is seen as a strong position in the industry. This is particularly relevant given the current attractive opportunities for direct lending investments.
Nuveen Churchill Direct Lending's capital-raising efforts around the time of its IPO have been significant. The company has amassed approximately $355 million in equity capital, which includes the greenshoe option and two pre-IPO equity calls. With an assumed leverage ratio of approximately 1.25 times, the analyst estimates that Nuveen Churchill Direct Lending has around $800 million available for investment, assuming other conditions remain constant.
The Market Perform rating suggests that the analyst views the stock as likely to perform in line with the broader market or its sector. This initiation of coverage provides investors with an assessment of Nuveen Churchill Direct Lending's market positioning following its IPO and its potential for capital investment in the direct lending market.
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