Blue Owl Technology Finance Corp (OTF) saw its shares plummet 5.12% during intraday trading on Friday, extending the stock's recent weakness within the business development company (BDC) sector.
The decline comes amid broader concerns affecting publicly traded BDCs. According to market analysis, worries stemming from a restriction on client redemptions at a private BDC managed by Blue Owl Capital, called Blue Owl Capital Corp. II, have spilled over to pressure the shares of publicly listed peers. This event has raised questions about liquidity and valuation practices for illiquid assets within the sector.
Further contributing to the negative sentiment, Clear Street lowered its price target on OTF to $14 from $15 earlier in the session, while maintaining a Hold rating. Oppenheimer also maintained its Hold rating on the stock. Market data cited in recent coverage shows OTF trading at a significant 29.0% discount to its reported net asset value (NAV) and posting a negative 15.3% return for the year through February 19th, highlighting the challenging environment for BDCs.
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