Hercules Capital, Inc. (HTGC) Loud Thud Doesn’t Negate The Long-Term Story

Despite closing 0.13 points higher on 14 March, Hercules Capital, Inc. (NYSE:HTGC) remains a key investment for many, but the stock is also a popular trading vehicle. Here’s how to trade it using charts and trading levels Friday. The shares accumulated 1.06 percent at $12.39 with a light trade volume of 2.022 million shares. After opening the session at $12.32, the shares went as high as $12.64 and as low as $12.21, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $1.19 billion and now has 96.45 million shares outstanding. Hercules Capital, Inc. (HTGC) stock has lost -4.47 percent of market value in 21 trading days.

HTGC stock has a trailing 3-year beta of 0, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $0.83 a share in the trailing twelve months. The stock’s value has surged 12.13 percent year to date (YTD) against a rise of 0.97 percent in 12 month’s time. The company’s shares still trade -12.56 percent away from its 1-year high of $14.17 and 17.22 percent up from 52-week low of $10.57. The average consensus rating on the company is 1.7, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a buy.

Hercules Capital, Inc. (HTGC) will probably climb 18.64 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $16-month high price target. This represents a whopping 29.14 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $13.25, which represents a return potential of 6.94 percent when compared to the closing price of the stock of $12.39 on Thursday, March 14. The lowest price target for the stock is $11.5 — slightly more than -7.18 percent from HTGC’s current share price.

History has shown that shares in Hercules Capital, Inc. have gone down on 18 different earnings reaction days and are predicted to add 0.02 percent when the company reports upcoming earnings. Investors will get their next glimpse of HTGC’s Q1 earnings on May 02. Analysts are forecasting revenue to climb 19.1 percent to $57.98M in the fiscal first quarter, while earnings are seen soaring by nearly 0 percent to $0.31 per share. It earned $0.32 per share, better than the $0.31, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $56.89M, better than the $54.86M analysts expected. Earnings are estimated to increase by 12.6 percent this year, 5.2 percent next year and continue to increase by 5 percent annually for the next 5 years.

The stock is currently hovering around the first support level of $12.19. Below this, the next support is placed in the zone of $11.98. Till the time, the HTGC stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 37.52 on daily chart, which may remain a cause for comfort. If the price breaks below $11.98 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $12.62 mark may result into a pull-back move towards $12.84 level.

Shares of Hercules Capital, Inc. (HTGC) are trading at a P/E ratio of 13.8 times earnings reported for the past 12 months. The industry HTGC operates in has an average P/E of 10.42. Its P/E ratio went as low as 10.08X and as high as 20.49 over the 5-year span.Further, it is sporting a 5.75 on the Price-to-Sales ratio. Compare this with the industry average P/S of 11.62.