UPDATE: Bank Of America Reiterates On TPG Specialty Lending As Momentum Builds

In a report published Thursday, Bank of America analyst Kenneth Bruce reiterated a Buy rating on TPG Specialty Lending (NYSE: TSLX), and raised the price target from $17.50 to $18.50.

In the report, Bank of America noted, “TSLX achieved impressive results during Q1'14, defying negative industry trends. The investment margin expanded to record levels due to strong fees. Origination activity was the third highest since inception, generating robust portfolio growth. We view TSLX as one of the higher quality business development corporations (BDCs) given its strong operating performance, and think it is better positioned than most peers to generate consistent, risk adjusted returns in this somewhat sluggish economic backdrop.

"Origination activity should remain robust given its strong sourcing platform and sponsor relationship. Still, yield pressure will likely persist in the near term due to competitive pressures. However, its portfolio structure along with the ability to generate strong fees should help mitigate margin erosion.”

TPG Specialty Lending closed on Wednesday at $17.84.