180 Degree Capital Corp. Notes Average Discount of Net Asset Value Per Share to Stock Price for Ninth Month of Initial Measurement Period of Its Discount Management Program
Rhea-AI Summary
180 Degree Capital Corp. (NASDAQ: TURN) reported an average discount of approximately 21% between its estimated daily net asset value per share (NAV) and its daily closing stock price in September 2024. The year-to-date average discount through September 2024 was about 20%, with a 24% discount on September 30, 2024. The company's Board of Directors is evaluating options under its Discount Management Program, which could include expanding the stock buyback program, cash distributions, or a tender offer if the average daily discount exceeds 12% during specified measurement periods.
CEO Kevin M. Rendino noted a potential shift in sentiment towards small-cap stocks, partly due to the Fed's interest rate reduction. The company believes the current discount to NAV doesn't reflect the potential upside of its portfolio. President Daniel B. Wolfe emphasized that no decisions have been made regarding ending the first measurement period early or taking specific actions, and the Board will prioritize the interests of all shareholders in any decisions made.
Positive
- Potential shift in sentiment towards small-cap stocks due to Fed's interest rate reduction
- Board considering options to address the NAV discount, including stock buyback expansion, cash distributions, or tender offer
- Company actively evaluating potential actions to increase shareholder value
Negative
- 21% average discount between NAV and stock price in September 2024
- 24% discount to NAV as of September 30, 2024
- Persistent NAV discount potentially undervaluing the company's portfolio
News Market Reaction – TURN
On the day this news was published, TURN declined 0.47%, reflecting a mild negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
MONTCLAIR, N.J., Oct. 01, 2024 (GLOBE NEWSWIRE) -- 180 Degree Capital Corp. (“180 Degree Capital”) (NASDAQ: TURN), noted today that the average discount between its estimated daily net asset value per share (“NAV”) and its daily closing stock price during September 2024 and year-to-date through the end of September 2024, were approximately
As previously disclosed in a press release on November 13, 2023, 180 Degree Capital’s Board of Directors (the “Board”) has set two measurement periods of 1) January 1, 2024 to December 31, 2024, and 2) January 1, 2025 to June 30, 2025, in which it will evaluate the average discount between TURN’s estimated daily NAV and its closing stock price pursuant to a Discount Management Program. Should TURN’s common stock trade at an average daily discount to NAV of more than
“We believe that what we stated in our press release at the beginning of September remains true today,” said Kevin M. Rendino, Chief Executive Officer of 180 Degree Capital. “We believe the sentiment towards small capitalization stocks has started to shift, in part, as a result of the first reduction in interest rates by the Fed in over two years. This action, coupled with improvements in cyclical industries that are sensitive to interest rates and the realization that a soft landing is indeed possible should accrue to the benefit of companies such as those we own. We continue to believe that our current discount to NAV is wholly inconsistent with what we believe is the potential upside within our existing portfolio as well as our actual NAV. We have spent a lot of time evaluating options related to the Discount Management Program, as well as other additional paths designed to increase shareholder value. We appreciate the perspectives provided by our stockholders, particularly our long-term shareholders, and are committed to approaching our decisions with shareholder interests as our number one priority. While we do not have anything to announce on this front as of today, do not let that give you the impression we are sitting idle. We are actively evaluating potential actions to take regarding the Discount Management Program, as well as other ways of potentially building stockholder value.”
Daniel B. Wolfe, President of 180 Degree Capital, added, “We continue to greatly appreciate the support of our largest and long-term investors. To be clear, the Board has not decided about ending the first measurement period early, and/or if it decides to do so, what steps might be taken amongst those mentioned previously or other available alternatives. Any decisions made will be made by the Board in order to serve the best interests of all shareholders of TURN, which is why we appreciate the thoughts and feedback Kevin mentioned above. We remain laser focused on taking steps that we believe will lead to the creation of value for all shareholders, whether that be through growth of net assets, the Discount Management Program, or other strategic efforts.”
About 180 Degree Capital Corp.
180 Degree Capital Corp. is a publicly traded registered closed-end fund focused on investing in and providing value-added assistance through constructive activism to what we believe are substantially undervalued small, publicly traded companies that have potential for significant turnarounds. Our goal is that the result of our constructive activism leads to a reversal in direction for the share price of these investee companies, i.e., a 180-degree turn. Detailed information about 180 and its holdings can be found on its website at www.180degreecapital.com.
Press Contact:
Daniel B. Wolfe
Robert E. Bigelow
180 Degree Capital Corp.
973-746-4500
ir@180degreecapital.com
Mo Shafroth
RF Binder
Morrison.shafroth@rfbinder.com
Forward-Looking Statements
This press release may contain statements of a forward-looking nature relating to future events. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions. These statements reflect the Company's current beliefs, and a number of important factors could cause actual results to differ materially from those expressed in this press release. Please see the Company's securities filings filed with the Securities and Exchange Commission for a more detailed discussion of the risks and uncertainties associated with the Company's business and other significant factors that could affect the Company's actual results. Except as otherwise required by Federal securities laws, the Company undertakes no obligation to update or revise these forward-looking statements to reflect new events or uncertainties. The reference and link to the website www.180degreecapital.com has been provided as a convenience, and the information contained on such website is not incorporated by reference into this press release. 180 is not responsible for the contents of third-party websites.
1. Daily estimated NAVs used for the discount calculation outside of quarter-end dates are determined as prescribed in 180’s Valuation Procedures for Level 3 assets. Non-investment-related assets and liabilities used to determine estimated daily NAV are those reported as of the end of the prior quarter.
FAQ
What was 180 Degree Capital's (TURN) average discount to NAV in September 2024?
What options is 180 Degree Capital (TURN) considering under its Discount Management Program?
What factors does 180 Degree Capital (TURN) believe are contributing to a potential shift in small-cap stock sentiment?
Has 180 Degree Capital (TURN) made any decisions about ending the first measurement period early as of October 1, 2024?
