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Jefferies on Wednesday initiated coverage of Trinity Capital (NASDAQ:TRIN) at Buy, given its “best-in-class” return on equity at a discount to other internally-managed business development companies.
“We like its positioning in the venture-backed lending space; shareholder-friendly, efficient structure; attractive valuation; best-in-class ROE; and strong track record investing in both term loans/equipment financing,” said analyst Kyle Joseph.
Shares of Trinity (TRIN), which primarily provides debt capital to venture-backed companies, have sold off since the Silicon Valley Bank collapse.
“We believe the resulting market dislocation is an attractive environment for TRIN to take advantage of and see improving risk-adjusted investment opportunities,” Joseph noted.
He expects Trinity (TRIN) to continue executing, saying it has numerous levers to further expand its ROE.
Price target set at $15, implying 9.1% potential upside to TRIN’s last close.
Trinity’s (TRIN) stock, which gained ~31% YTD, rose 4.9% in morning trade on Wednesday.
Jefferies’ views are in line with bullish sell-side ratings, but SA Quant rates the stock Hold.
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