Hercules Capital (NYSE:HTGC) Releases Quarterly Earnings Results, Meets Estimates

Hercules Capital (NYSE:HTGC) released its quarterly earnings results on Thursday. The financial services provider reported $0.48 EPS for the quarter, hitting the consensus estimate of $0.48, FiscalAI reports. The business had revenue of $133.25 million during the quarter, compared to analyst estimates of $141.57 million. Hercules Capital had a net margin of 63.80% and a return on equity of 16.17%. During the same quarter in the prior year, the firm earned $0.49 earnings per share.

Here are the key takeaways from Hercules Capital’s conference call:

• Record 2025 operating results — Q4 originations of $1.06B and nearly $4B of originations for the year drove record gross fundings of $2.28B and record total/net investment income, with platform AUM topping $5.7B (+20% YoY).
• Strong liquidity and disciplined balance sheet — over $1B of platform liquidity (≈$525M in the BDC) and a post-quarter $300M 5.35% note issuance, while GAAP leverage remained at the low end of its historical BDC range (104.4%).
• Credit quality and conservative underwriting — internal credit rating improved (2.20), only one non‑accrual loan (~0.2% of portfolio at cost), low weighted average LTV (~14%), ~90% first‑lien exposure, and tighter credit screens amid market volatility.
• Private funds momentum and shareholder distributions — the adviser now manages nearly $2B, contributed ~$23M in 2025, and the company maintained a $0.40 base dividend plus a $0.28 annual supplemental program (Q4 base coverage ~120%; total distribution coverage ~102%).

Hercules Capital Price Performance

Shares of Hercules Capital stock traded down $0.99 during trading on Friday, hitting $15.61. The stock had a trading volume of 8,618,716 shares, compared to its average volume of 1,948,070. The business has a fifty day moving average of $18.33 and a two-hundred day moving average of $18.45. Hercules Capital has a fifty-two week low of $15.40 and a fifty-two week high of $22.04. The firm has a market cap of $2.84 billion, a P/E ratio of 8.53 and a beta of 0.84. The company has a debt-to-equity ratio of 0.98, a current ratio of 1.65 and a quick ratio of 1.65.

Hercules Capital Cuts Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Wednesday, March 4th. Stockholders of record on Wednesday, February 25th will be paid a $0.07 dividend. This represents a $0.28 dividend on an annualized basis and a dividend yield of 1.8%. The ex-dividend date of this dividend is Wednesday, February 25th. Hercules Capital’s payout ratio is currently 93.02%.

Key Stories Impacting Hercules Capital

Here are the key news stories impacting Hercules Capital this week:

• Positive Sentiment: Q4 operational strength: originations rose sharply year‑over‑year and management described a strong quarter with record performance and rising investment income — factors that support future yield and portfolio growth. MSN: Q4 originations rise
• Neutral Sentiment: Dividend/debt optionality highlighted: management is weighing a supplemental dividend and the use of new debt against current valuation — a potential shareholder return but with balance‑sheet implications; outcome will be a near‑term catalyst. Yahoo: Dividend and debt considerations
• Negative Sentiment: Analysts cut targets: Keefe, Bruyette & Woods lowered its price target to $19 (still an outperform) and Wells Fargo trimmed its target to $17 while maintaining overweight — downward revisions reduce headline upside and likely pressured the stock. Benzinga: Analyst target cuts
• Negative Sentiment: Earnings nuance — EPS met estimates but revenue missed and expenses rose year‑over‑year; EPS of $0.48 matched consensus but revenue was $133.3M vs. $141.6M expected, and operating costs increased, which dented the headline print. Zacks: Q4 results
• Negative Sentiment: High trading volume and near‑term uncertainty: the stock saw elevated volume on the print and mixed messages on capital allocation (dividend vs. debt), creating selling pressure until the board provides clearer guidance. MarketBeat: Earnings & materials

Institutional Investors Weigh In On Hercules Capital

A number of institutional investors and hedge funds have recently bought and sold shares of the business. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC acquired a new position in shares of Hercules Capital in the 4th quarter worth approximately $27,000. Northwestern Mutual Wealth Management Co. grew its position in Hercules Capital by 113.1% in the fourth quarter. Northwestern Mutual Wealth Management Co. now owns 1,884 shares of the financial services provider’s stock worth $35,000 after buying an additional 1,000 shares during the last quarter. WFA of San Diego LLC bought a new position in shares of Hercules Capital in the second quarter valued at $55,000. Advocate Investing Services LLC acquired a new stake in shares of Hercules Capital during the 4th quarter valued at $80,000. Finally, Geneos Wealth Management Inc. lifted its position in shares of Hercules Capital by 30.7% during the 2nd quarter. Geneos Wealth Management Inc. now owns 6,475 shares of the financial services provider’s stock valued at $118,000 after acquiring an additional 1,520 shares during the last quarter. 19.69% of the stock is owned by institutional investors and hedge funds.

Wall Street Analyst Weigh In

Several equities research analysts have commented on the stock. Piper Sandler lowered shares of Hercules Capital from an “overweight” rating to a “neutral” rating and dropped their price target for the company from $20.50 to $17.50 in a research note on Friday. Lucid Cap Mkts upgraded Hercules Capital to a “strong-buy” rating in a research report on Monday, December 15th. Weiss Ratings reiterated a “buy (b-)” rating on shares of Hercules Capital in a research report on Wednesday, January 28th. Wells Fargo & Company decreased their price target on Hercules Capital from $18.00 to $17.00 and set an “overweight” rating for the company in a research note on Friday. Finally, Capital One Financial set a $19.75 price objective on shares of Hercules Capital in a research note on Monday, December 15th. One research analyst has rated the stock with a Strong Buy rating, five have assigned a Buy rating and three have given a Hold rating to the company’s stock. Based on data from MarketBeat.com, Hercules Capital presently has a consensus rating of “Moderate Buy” and a consensus price target of $19.39.

Hercules Capital Company Profile

Hercules Capital, Inc is a specialty finance company organized as a business development company (BDC) that provides tailored debt financing solutions to high‐growth companies. Through its external management structure, Hercules Capital extends senior secured loans, subordinated debt and growth capital designed to support research and development, expansion initiatives and working capital needs. The firm primarily partners with venture capital and private equity sponsors to finance innovative enterprises across various developmental stages.

The company’s investment portfolio is concentrated in technology, life sciences and sustainable and renewable technology sectors, reflecting its focus on industries with strong growth prospects and recurring capital requirements.