Eagle Point Credit Company Monthly Update

Specialty finance company Eagle Point Credit Company (NYSE:ECC) has released their monthly business update.

While there are times that it seems the monthly report is overkill we believe the more info they put forward the better.  IN PARTICULAR because ECC is somewhat of a ‘blackbox’ invesment company—i.e. they invest primarily in Collateralized Loan Obligations (CLOs).

The company has 4 income securities outstanding that we keep an eye on–2 term preferreds and 2 baby bonds.

The monthly paying term preferreds have trade strongly all through the last month–dipping for only a short time before powering up to where they had started.  The ECCA issue has a coupon of 7.75% and the ECCB issue has the same coupon.

The baby bonds have traded a bit weaker than the preferreds because of the lower coupons of those issues and longer dated maturities.  ECCX has a coupon of 6.6875% with maturity in 2028.  While ECCY has a coupon of 6.75% with maturity in 2027.

Disclosure-we own the ECCA issue of term preferred.

One thought on “Eagle Point Credit Company Monthly Update”

  1. Tim, I am long cumulative term preferreds ECCA (I believe will be called soon), ECCB and baby bond ECCZ. I was quite concerned with the drop in NAV of ECC late last year. I am very familiar with CLO’s as I bought many during the 2008-2009 crisis (were some of my best gains ever) and have a good friend that manages a large portfolio of CLO’s for the Carlyle Group. When I asked him about ECC recently he said “just keep collecting the monthly distributions and hold your nose until the storm passes”. Stay tuned, Nomad

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