Great Elm Capital Reports Q4 Earnings Miss

Written by Emily J. Thompson, Senior Investment Analyst

Source: seekingalpha

Updated: 1 day ago

0mins

GECC-3.69%

Should l Buy GECC?

Source: seekingalpha

Earnings Miss: Great Elm Capital reported a Q4 GAAP EPS of -$1.57, missing estimates by $1.91, indicating significant challenges in profitability that could undermine investor confidence.
Investment Income Growth: Total investment income for the quarter ended December 31, 2025, was $12.6 million, up from $10.6 million for the quarter ended September 30, 2025, suggesting improvements in portfolio management despite overall earnings falling short.
Increased Cash Distributions: The company received $4.3 million in cash distributions from CLO Formation JV in Q4, a substantial increase from $1.5 million in the previous quarter, reflecting improved investment returns that may support future cash flows.
Declining Net Assets: As of December 31, 2025, GECC's net assets were $112.9 million, down from $140.1 million as of September 30, 2025, primarily due to unrealized losses comprising over half of the change, highlighting vulnerabilities in the balance sheet.

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Analyst Views on GECC

Wall Street analysts forecast GECC stock price to rise

2 Analyst Rating

1 Buy

1 Hold

0 Sell

Moderate Buy

Current: 6.230

Low

8.50

Averages

9.25

High

10.00

Current: 6.230

Low

8.50

Averages

9.25

High

10.00

Clear Street

Mickey Schleien

Buy

downgrade

$10

2025-11-07

Reason

Clear Street

Mickey Schleien

Price Target

$10

AI Analysis

2025-11-07

downgrade

Buy

Reason

Clear Street analyst Mickey Schleien lowered the firm's price target on Great Elm Capital to $8.50 from $10 and keeps a Buy rating on the shares. The company reported a "rough" Q3 with multiple credit issues, the analyst tells investors in a research note. The firm now expects lower forward earnings and possible dividend pressure in 2026 for Great Elm.

Janney Montgomery Scott

Neutral

downgrade

$12 -> $10

2025-11-06

Reason

Janney Montgomery Scott

Price Target

$12 -> $10

2025-11-06

downgrade

Neutral

Reason

Janney Montgomery Scott lowered the firm's price target on Great Elm Capital to $10 from $12 and keeps a Neutral rating on the shares.

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About GECC

Great Elm Capital Corp. operates as a closed-end, externally managed, non-diversified management investment company. The Company’s objective seeks to generate current income and capital appreciation through debt and income-generating equity investments, including investments in specialty finance businesses. It invests in secured and senior secured debt instruments of middle market companies, as well as income-generating equity investments in specialty finance companies. In addition, it invests in collateralized loan obligations (CLOs) and related warehouse facilities. It also makes investments throughout other portions of a company’s capital structure, including subordinated debt, mezzanine debt, and equity or equity-linked securities. The Company is managed by Great Elm Capital Management, LLC.

About the author

Emily J. Thompson

Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.

GREAT ELM CAPITAL CORP. Reports Q4 EPS of USD -1.57

1 day agomoomoo

Earnings Report: Great Elm Capital Corp reported a Q4 EPS of $1.57.
Financial Performance: The earnings indicate a strong financial performance for the quarter.

Great Elm Capital Corporation Q4 2025 Earnings Call Insights

17 hours agoseekingalpha

Management Changes: Newly appointed Executive Chairman Jason Reese emphasized the Board's decision to enhance direct engagement with management to navigate a more demanding credit environment, which is expected to improve governance and shareholder value.
Investment Income Growth: CEO Matt Kaplan reported that net investment income increased over 50% quarter-over-quarter to $0.31 per share, primarily due to higher cash income and stronger CLO joint venture distributions, indicating positive performance in revenue growth.
Net Asset Value Changes: As of December 31, 2025, the company's net assets were $112.9 million or $8.07 per share, down from $140.1 million or $10.01 per share in the previous quarter, reflecting market volatility amid active portfolio repositioning.
Dividend Announcement: CFO Keri Davis announced a quarterly dividend of $0.30 per share for Q1 2025, equating to a 19.2% annualized yield, demonstrating the company's commitment to returning value to shareholders while maintaining cash flow.

Great Elm Capital Appoints New Executive Chairman

1 day agoNewsfilter

Board Changes: Jason Reese has been appointed as Executive Chairman of Great Elm Capital, succeeding Matthew Drapkin, who will remain as Vice Chairman, ensuring continuity and stability in corporate governance.
Fee Waiver: The investment adviser of Great Elm Capital waived all accrued incentive fees as of December 31, 2025, totaling approximately $2.3 million, or $0.16 per share, which will directly enhance the company's net asset value.
Financial Performance: For the fourth quarter of 2025, the company reported net investment income of $4.4 million, or $0.31 per share, reflecting over 50% growth quarter-over-quarter, demonstrating resilience and profitability in a challenging market environment.
Dividend Distribution: The board declared a distribution of $0.30 per share for the first quarter of 2026, resulting in an annualized yield of 19.2%, highlighting the company's commitment to shareholder returns and effective cash flow management.