Wells Fargo Downgrades FS KKR Group (FSK) to Equal Weight

Wells Fargo analyst Finan O'Shea downgraded FS KKR Group (NYSE: FSK) from Overweight to Equal Weight with a price target of $21.00.

The analyst comments "FSK's discount to the BDC industry has compressed since our 5/29/24 upgrade, which was predicated on FSK's deeper discount vs. the industry. At this juncture we see less upside on valuation (now 0.93x NAV), and potentially more challenged earnings as the BDC rotates into lower-spread assets. • We see some risks to credit, as FSK has ~$448 million of loan content marked below 90% but still on accrual, of which 48Forty makes up ~40% of such exposures, where the mark declined from ~93% to ~87% during the quarter. The company, which sells and manages pallets, may be under pressure in the currently soft logistics market (a source of new defaults / non-accruals in the industry, recently with SEKO, Convoy)."

For an analyst ratings summary and ratings history on FS KKR Group click here. For more ratings news on FS KKR Group click here.

Shares of FS KKR Group closed at $22.22 yesterday.

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