Assessing Hercules Capital (HTGC) Valuation After Recent Share Price Rebound

Dividend income and valuation context

Hercules Capital (HTGC) has been quietly grinding higher over the past month, even as its year to date return still lags. That mix of recent momentum and earlier weakness sets up an interesting dividend and valuation story.

See our latest analysis for Hercules Capital.

With the share price now around $18.71, Hercules Capital’s 1 month share price return of 6.49% has started to reverse a weaker year to date share price return of 8.19%. However, long term total shareholder returns remain strong, including a 3 year total shareholder return near 99%, suggesting sentiment is quietly rebuilding as investors refocus on its income profile and growth pipeline.

If Hercules’s recent move has you rethinking your income and growth mix, this is a good moment to explore fast growing stocks with high insider ownership for other under the radar opportunities.

With shares still trading below analyst targets and our estimate of intrinsic value, the recent rebound could be the start of a re rating rather than the end of the easy gains. Is this a fresh entry point, or is future growth already priced in?

Most Popular Narrative Narrative: 11.8% Undervalued

With Hercules Capital closing at $18.71 versus a narrative fair value near $21.22, the story leans toward upside if its growth path holds.

Analysts expect earnings to reach $455.0 million (and earnings per share of $1.97) by about September 2028, up from $256.6 million today. In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 13.5x on those 2028 earnings, which is the same as it is today.

Read the complete narrative.

Curious how steady revenue expansion, climbing margins, and an unchanged earnings multiple can still point to meaningful upside? The narrative’s forecasts hide some surprisingly punchy growth math.

Result: Fair Value of $21.22 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, intensifying competition in venture lending and Hercules’s heavy tilt to tech and life sciences could quickly pressure yields, margins, and long term earnings visibility.

Find out about the key risks to this Hercules Capital narrative.

Build Your Own Hercules Capital Narrative

If you are not fully convinced by this view or prefer to dig into the numbers yourself, you can build a personalized thesis in just a few minutes. Do it your way.

A great starting point for your Hercules Capital research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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