Boston, MA 09/08/2014 (wallstreetpr) – PennantPark Investment Corp. (NASDAQ:PNNT) announcement that it is set to carry out a public offering of its stock failed to spark a rally in the market on Friday trading session. The stock slumped by 3.79% closing the week on a low of $11.41. MarketWatch reports that the company has entered into a definitive agreement to sell 8,500,000 shares at a share price target of $11.63 each,
Uses of Offerings Proceeds
If successful, the offering will allow PennantPark Investment Corp. (NASDAQ:PNNT) to raise a total of $98,855,000in gross proceeds. The offering comes at a time that the company is trying to clear its indebtedness. Proceeds from the offering will be used to pay debt under the company’s senior secured revolving credit facility. Part of the amount will also be used for investment in other new businesses that the company expects to spur growth in the future.
PennantPark Investment Corp. (NASDAQ:PNNT) has also confirmed that underwriters will receive an opportunity to purchase up to 1,275,000 shares of the company common stock. PennantPark Investment board looks to have approved the transaction awaiting for customary closing conditions. The offering will be’ opened on September 10, 2014. PennantPark Investment has appointed Morgan Stanley (NYSE:MS), Goldman Sachs Group Inc. (NYSE:GS) and UBS AG (NYSE:UBS) as some of the underwriters for the offering.
PennantPark Investment Is a ‘Buy’
PennantPark Investment continues to be rated positively by TheStreet research team which has a ‘Buy ‘rating on it. Consistent growth in net income, as well as expansion in profit margins, continue to be some of the strongholds on the company. PennantPark Investment commands an impressive return on equity, as well as good cash flow at the back of the upcoming offering.
The company continues to grow on the revenue front seen by its growth outpacing that of the industry average of 3%. PennantPark Investment Corp. (NASDAQ:PNNT) revenue in the last quarter grew by 5.2% compared to the same quarter a year ago
