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Hercules Capital Inc, known by the ticker symbol HTGC is a Large-cap asset manage, operating in the financial services business sector. This is my first ever report on HTGC for this Viital portfolio or any of my previous six folios.

Hercules Capital, Inc. is a business development company. The firm specializes in providing venture debt, debt, senior secured loans, and growth capital to privately held venture capital-backed companies at all stages of development from startups, to the expansion stage including select publicly listed companies and select special opportunity lower middle-market companies.

The firm provides growth capital financing solutions for capital extension; management buy-out and corporate spin-out financing solutions; acquisition financing; sales and marketing development, and manufacturing expansion.

The firm also provides bridge financing to IPO or mergers and acquisitions or technology acquisitions; dividend recapitalizations and other sources of investor liquidity.

The firm invests primarily in structured debt with warrants and, to a lesser extent, in senior debt and equity investments. The firm generally seeks to invest in companies that have been operating for at least six to 12 months prior to the date of their investment.

It prefers to invest in technology, energy technology, sustainable and renewable technology, and life sciences.

Within technology the firm focuses on advanced specialty materials and chemicals; communication and networking, consumer and business products; consumer products and services, digital media and consumer internet; electronics and computer hardware; enterprise software and services.

Within energy technology, it invests in agriculture; clean technology; energy and renewable technology, fuels and power technology; geothermal; smart grid and energy efficiency and monitoring technologies; solar; and wind.

Within life sciences, the firm invests in biopharmaceuticals; biotechnology tools; diagnostics; drug discovery, development, and delivery; medical devices and equipment; surgical devices; therapeutics; pharma services; and specialty pharmaceuticals. It also invests in educational services.

The firm invests primarily in United States-based companies. The firm prefers to invest between $10 million to $250 million in equity per transaction. It invests generally between $1 million to $40 million in companies focused primarily on business services, communications, electronics, hardware, and healthcare services.

The firm invests primarily in private companies but also has investments in public companies. For equity investments, the firm seeks to represent a controlling interest in its portfolio companies which may exceed 25% of the voting securities of such companies.

The firm seeks to invest a limited portion of its assets in equipment-based loans to early-stage prospective portfolio companies. These loans are generally for amounts up to $3 million but may be up to $15 million for certain energy technology venture investments.

The firm formerly known as Hercules Technology Growth Capital, Inc. Hercules Capital, Inc. was founded in December 2003 and is based in Palo Alto, California with additional offices in Connecticut; Boston, Massachusetts; San Diego, California; Westport, Connecticut; Elmhurst, Illinois; Santa Monica, California; McLean, Virginia; New York, New York; Radnor, Pennsylvania; and Washington, District of Columbia and London, United Kingdom.

Three key data points gauge any dividend equity or fund such as Hercules Capital Inc (HTGC).

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether any company has made, is making, and will make money.
 

HTGC Price

Hercules Capital’s price per share was $14.07 as of yesterday's market close. One year ago its price was $17.25. Therefore, HTGC’s share price fell $3.18 or about 18.4%% in the past year.

If Hercules Capital’s stock trades in the range of $12.00 to $20.00 this next year, its recent $14.07 share price might rise by $2.93 to reach $17.00 by June 2, 2023. My $2.93 upside estimate is $1.44 under the median of annual price increases calculated by nine analysts covering HTGC for broker firms.
 

HTGC Dividends

Hercules Capital’s most recently declared a quarterly dividend of $0.48 was paid, on May 24, 2022, to shareholders on record as of May 16th.

Hercules Capital initiated a quarterly $0.30 dividend as of January 27, 2006. The dividend varied from as low as $0.01 to $0.48 from 2006 to $048 as of March’s quarterly payout. Its most recent four payouts equate to $1.75 and that annual payout is calculated to deliver a 12.4% annual yield per yesterday’s $14.09 share price.
 

HTGC Returns

Adding the $1.75 HT annual dividend to my estimated one-year price upside of $2.91 shows a $4.66 potential gross gain, per share, to be reduced by any costs to trade HTGC shares.

At yesterday's $14.09. the closing price per share, a little over $1000 would buy 71 shares.

A $10 broker fee (if charged) would be paid half at purchase and half at the sale and might cost us about $0.14 per share.

Subtract that maybe $0.14 brokerage cost from my estimated $4.66 gross gain estimate per share results in a net gain of $4.52 X 71 shares = $320.92 for a 32.09% net gain including a 12.42% forward-looking dividend yield.

So it is that Hercules Capital Inc shows a possible 32.09% net gain including a 12.42% forward-looking dividend yield.

Over the next year, this time our $1000 investment in Hercules Capital Inc shares might generate $124.20 in cash dividends. Of course, a single share of HTGC stock bought at yesterday's $14.09 price is almost one-ninth the dividend income from our $1000.00 investment.

So, by my dogcatcher ideal, this is a perfect time to pick up Hercules Capital Inc shares based on their forward-looking dividends for the year 2022. A forthcoming annual dividend from $1K invested is estimated to be 8.15 times more than yesterday's single share price. Consider yourself alerted. It's a sign.

All of the estimates above are speculation based on the past history of Hercules Capital Inc (HTGC). Only time and money invested in this stock will determine its market value.