News

Blue Owl Capital Corporation OBDC reported first-quarter 2024 earnings per share (EPS) of 47 cents, which missed the Zacks Consensus Estimate by 2.1%. However, the bottom line improved 4.4% year over year.

The total investment income of OBDC amounted to $400 million, which increased 5.8% year over year. The top line beat the Zacks Consensus Estimate of $399 million.

OBDC’s first-quarter earnings were impacted by higher interest expenses as a result of higher average rates. The ratio of total expenses to average net assets deteriorated 90 basis points year over year to 14.4% in the first quarter of 2024. However, strong credit performance, rising net investment income and new investment commitments partially offset the negatives.

Blue Owl Capital Corporation Price, Consensus and EPS Surprise

Q1 Update

Net investment income increased 2.8% year over year to $182.8 million. However, the metric missed our estimate of $187.1 million.

Total new investment commitments (net of sell downs) were $1.2 billion across 18 new portfolio companies and 13 existing ones. The metric rose more than five-fold year over year in the quarter under review.

Blue Owl Capital ended the first quarter with investments in 198 portfolio companies, backed with an aggregate fair value of $12.4 billion. Based on the fair value, the average investment size in each portfolio company was $62.7 million as of Mar 31, 2024.

Total expenses escalated 7.7% year over year to $211.6 million in the first quarter. The metric was higher than our estimate of $206 million, primarily due to higher interest expenses and performance-based incentive fees.

The company recorded a net income of $182.5 million in the first quarter compared with $201.8 million in the year-ago period.

Financial Update (as of Mar 31, 2024)

Blue Owl Capital exited the first quarter with cash and restricted cash of $666.7 million, which improved from $658.7 million as of Dec 31, 2023. Total assets of $13.3 billion fell from $13.5 billion at 2023-end.

Debt was $6.9 billion, down from $7.1 billion at 2023-end. OBDC had $1.7 billion of undrawn capacity under its credit facilities.

Net cash from operating activities in the first quarter of 2024 was $444.2 million compared with the prior-year figure of $46.3 million.

At the first-quarter end, net debt to equity was 1.04X compared with 1.21x in the year-ago quarter.

Dividend & Repurchase Update

The board of directors at Blue Owl Capital declared a second-quarter 2024 dividend of 37 cents per share, to be paid on or before Jul 15, 2024, to shareholders of record as of Jun 28. It also provided a first-quarter 2024 supplemental dividend of 5 cents per share.

OBDC’s board approved a new share repurchase plan for 2024, under which the company may purchase shares up to $150 million.The company did not make share repurchases under this program in the first quarter, leaving it with a remaining fund of $150 million.

Zacks Rank

Blue Owl Capital currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Finance Sector Players

Here are some other Finance sector players that have reported first-quarter results so far. The bottom-line results of Euronet Worldwide, Inc. EEFT, Virtu Financial, Inc. VIRT and Cboe Global Markets, Inc. CBOE beat the Zacks Consensus Estimate.

Euronet reported first-quarter adjusted earnings of $1.28 per share, which surpassed the Zacks Consensus Estimate by 28%. The bottom line soared 47%. Total revenues were $857 million, which improved 9% year over year and on a constant-currency basis. The top line beat the consensus mark by 2.3%. EEFT’s net income climbed 32.3% year over year to $26.2 million. Operating income of $64 million advanced 40% year over year, or 45% on a constant-currency basis. Adjusted EBITDA rose 17% year over year, or 19% on a constant-currency basis, to $108.8 million.

The EFT Processing segment recorded revenues of $217.2 million, which grew 13% year over year, or 12% on a constant-currency basis. Adjusted EBITDA soared 51% year over year, or 54% on a constant-currency basis, to $44.7 million. Total transactions of the unit climbed 36% to 2,502 million. The epay segment’s revenues advanced 8% year over year and on a constant-currency basis to $257.1 million. The Money Transfer segment generated revenues of $384.6 million, which advanced 7% year over year and on a constant-currency basis.

Virtu Financial reported first-quarter 2024 adjusted earnings per share of 76 cents, which outpaced the Zacks Consensus Estimate by 28.8%. The bottom line advanced 2.7% year over year. Total revenues improved 3.6% to $642.8 million. Adjusted net trading income slid 1.7% to $366.9 million. Revenues from commissions, net and technology services amounted to $118.6 million, which slipped 2.3% year over year. Interest and dividends income of $106 million climbed 28.9% year over year.

Adjusted EBITDA of VIRT declined 2.2% to $202.8 million. Adjusted EBITDA margin of 55.3% deteriorated 30 basis points year over year. Adjusted net trading income in the Market Making segment was $273.7 million, down 1.5% year over year. The segment’s revenues rose 4.4% to $521 million. The Execution Services unit recorded an adjusted net trading income of $93.2 million, which fell 2.1% year over year.

Cboe Global reported first-quarter 2024 adjusted earnings of $2.15 per share, which outpaced the Zacks Consensus Estimate by 5.4%. The bottom line increased 13% year over year. Total adjusted revenues of CBOE Global were $502.1 million, which improved 7% year over year. The top line missed the consensus mark by 1.2%. Options revenues climbed 10% to $307.4 million. Revenues of North American Equities totaled $92.6 million, which decreased 1% year over year. Europe and Asia Pacific revenues increased 10% to $54.1 million.

Futures net revenues decreased 2% year over year to $30.5 million. Global FX net revenues decreased 1% to $18.4 million, primarily due to lower net transaction and clearing fees. Adjusted operating income grew 8% to $309.2 million. Adjusted operating margin was 61.6%, which expanded 110 basis points year over year. Adjusted EBITDA margin of 67.2% expanded 140 bps year over year.

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