Current Analysis: Fidus Investment Corporation

person using MacBook Pro on tableImage Source: UnsplashFidus Investment Corp (FDUS) is an externally managed, closed-end, non-diversified management investment company that has elected to be treated as a business development company.The company provides customized debt and equity financing solutions to lower middle-market companies, which management generally defines as U.S. based companies with revenues between $10 million and $150 million. The company invests in companies that possess some or all of the following attributes: predictable revenues; positive cash flows; defensible market positions; diversified customer and supplier bases; and management teams with operating discipline.The company was founded in 2011, based in Evanston, IL.Three key data points gaugeFidus Investment Corp or any dividend-paying firm.The key three are:(1) Price(2) Dividends(3) ReturnsThose three basic keys best tell whether any company has made, is making, and will make money.FDUS PriceOver the past year, Fidus’s share price increased about 3.76% from $18.88 to $19.59 as of Tuesday’s market close.If Fidus Corp trades in the range of $17.00 to $23.00 this next year, its recent $19.59 share price might rise to $21.00  by next year. Of course, Fidus’s price could drop about the same $1.40 estimated amount or more.My annual upside estimate of $1.41 however, is about $0.08 over the median of one-year target estimates from six analysts tracking FDUS.FDUS DividendFidus Investment Corp has paid Quarterly variable dividends since September 26, 2011.  Fidus’s most recently declared Q dividend of $0.80 is payable December 27, 2023, to shareholders of record December 19th. The forward-looking $2.73 annual dividend yields 13.91% at Tuesday’s $19.59 share price.FDUS ReturnsTo put it all together, add the annual dividend of  $2.73 to the price upside of $1.41 to find a $4.14 gross gain.At Tuesday’s $19.59 share price, a little under $1000 would buy 51 shares.A $10 broker fee (if charged), paid half at purchase and half at sale, might cost us about $0.20 per share.Subtracting that likely $0.20 brokerage cost from the $4.14 estimated gross gain per share produces a net gain of $3.94 X 51 shares = $200.94 for a 20.1% estimated net gain.You might choose to pounce on Fidus Investment Corp. It is a 12-year-old Evanston IL-based Business Development firm. Furthermore, the estimated $139.10 of dividend income from $1k invested is almost 6.75 times greater than Fidus’s $19.59 single share price.The exact track of Fidus Investment Corp’s ongoing future price and dividend is yet to be known.Remember the true value of any stock is best realized through personal ownership of shares.More By This Author:Current Analysis: Computershare Limited
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