GET DAILY SIGNALSNew Mountain Finance (NMFC) Delivers In-Line NII but NAV Falls to $10.67
Key Takeaways
- New Mountain Finance reported third-quarter 2026 net investment income (NII) of $23.69 million, down roughly 30% from the prior-year period.
- Adjusted NII per share came in at $0.26, matching the consensus estimate, while total investment income of $60.41 million fell short of the roughly $63 million analyst expectation.
- Net asset value (NAV), a key measure of a lender's underlying worth, declined to $10.67 per share from $10.89 in the prior quarter.
- Management declared a fourth-quarter 2026 distribution of $0.25 per share, payable on December 31, 2026, keeping the payout unchanged.
- The decline in NAV and year-over-year income highlights ongoing pressure on portfolio valuations and earning power even as the dividend remains covered.
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Why These Results Matter for BDC Investors
New Mountain Finance Corporation operates as a business development company, providing loans to middle-market companies and distributing most of its earnings to shareholders. BDC performance is best judged by the consistency of net investment income and the strength of the underlying loan book rather than traditional revenue growth. Ahead of the report, the focus was on whether softer credit conditions and selective markdowns would narrow the gap between earnings and the $0.25 distribution. The latest numbers give a clearer picture of coverage and the direction of asset quality.
Quarterly Figures at a Glance
For the three months ended September 30, 2026, NMFC posted net investment income of $23.69 million, about 30% lower than the year-ago quarter. Adjusted NII per share reached $0.26 and aligned with analyst forecasts. Total investment income totaled $60.41 million, missing the roughly $63.02 million consensus. Net asset value per share slipped to $10.67 at quarter-end from $10.89 three months earlier and $11.52 at the close of 2025. The portfolio carried a fair value near $2.26 billion across 109 holdings, with income-producing investments showing a weighted average yield to maturity at cost of approximately 12.0%. The board maintained the fourth-quarter distribution at $0.25 per share.
I also checked this using Tickeron’s AI Screener to see how NMFC stacks up against other BDCs on key metrics.
Market Reaction and What Comes Next
The earnings release arrived after the close on November 2, 2026, so price action will develop over the following sessions. The stock had already closed at $7.11 and was down more than 7% over the prior three months and more than 26% over the past year, reflecting caution around credit spreads and valuation stability. The matching NII per share provides some reassurance on dividend coverage, yet the NAV decline and revenue miss keep attention on potential further adjustments to the portfolio.
Key Areas to Watch Going Forward
The narrow cushion between adjusted NII of $0.26 per share and the $0.25 distribution leaves limited margin if income weakens further. Portfolio valuations deserve close monitoring as well; the drop in book value to $10.67 indicates that markdowns continue to affect the balance sheet. On the positive side, the 12.0% weighted average yield offers a solid base for future income, though the year-over-year NII contraction shows that lower origination and repayment activity are already reducing earnings. Origination volumes, repayment trends, and any updates on share repurchases will help clarify whether income can stabilize. With shares trading below NAV, management’s approach to buybacks versus preserving capital will remain an important topic.
Exploring AI Tools for Portfolio Analysis
I often turn to Tickeron’s AI Screener when comparing income-focused names like this one against peers. The platform lets me apply filters for yield, volatility, and sector trends to surface comparable ideas quickly and refine my watchlist with data-driven signals.
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Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
NMFC's Indicator enters downward trend
The Aroon Indicator for NMFC entered a downward trend on October 30, 2026. Tickeron's A.I.dvisor identified a pattern where the AroonDown red line was above 70 while the AroonUp green line was below 30 for three straight days. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options. A.I.dvisor looked at 179 similar instances where the Aroon Indicator formed such a pattern. In 94 of the 179 cases the stock moved lower. This puts the odds of a downward move at 53%.
Technical Analysis (Indicators)
Bearish Trend Analysis
The Stochastic Oscillator has been in the overbought zone for 2 days. Expect a price pull-back in the near future.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where NMFC declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 46%.
NMFC broke above its upper Bollinger Band on October 29, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
Bullish Trend Analysis
The RSI Indicator points to a transition from a downward trend to an upward trend -- in cases where NMFC's RSI Oscillator exited the oversold zone, 15 of 27 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 56%.
The Momentum Indicator moved above the 0 level on October 27, 2026. You may want to consider a long position or call options on NMFC as a result. In 29 of 93 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 31%.
The Moving Average Convergence Divergence (MACD) for NMFC just turned positive on October 27, 2026. Looking at past instances where NMFC's MACD turned positive, the stock continued to rise in 15 of 46 cases over the following month. The odds of a continued upward trend are 33%.
NMFC moved above its 50-day moving average on October 29, 2026 date and that indicates a change from a downward trend to an upward trend.
Following a +2.62% 3-day Advance, the price is estimated to grow further. Considering data from situations where NMFC advanced for three days, in 102 of 295 cases, the price rose further within the following month. The odds of a continued upward trend are 35%.
Fundamental Analysis (Ratings)
The Tickeron Valuation Rating of 3 (best 1 - 100 worst) indicates that the company is seriously undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (0.653) is normal, around the industry mean (2.410). P/E Ratio (-14.812) is within average values for comparable stocks, (-3.016). Projected Growth (PEG Ratio) (0.000) is also within normal values, averaging (1.319). Dividend Yield (0.141) settles around the average of (0.272) among similar stocks. NMFC's P/S Ratio (69.930) is slightly higher than the industry average of (15.694).
The Tickeron Seasonality Score of 50 (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Price Growth Rating for this company is 57 (best 1 - 100 worst), indicating steady price growth. NMFC’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is 78 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron PE Growth Rating for this company is 99 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is 100 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. NMFC’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 81, placing this stock worse than average.
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a private equity fund
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