RBC upgrades Owl Rock Capital to 'outperform'

RBC analyst Kenneth Lee upgraded Owl Rock Capital Corp. to "outperform" from "sector perform" on increasing confidence on portfolio growth trajectory.

The upgrade follows Owl Rock's strong originations in the fourth quarter 2020. The analyst wrote that the company will see both portfolio growth and earnings power by the second half of this year.

The key driver, wrote Lee, was Owl Rock's reaching the lower end of its targeted leverage range in the most recent quarter, driven by a very strong origination activity.

Moreover, the company reported fourth-quarter 2020 net investment income per share of 29 cents, above RBC's estimate of 26 cents.

The analyst additionally raised its price target for the company's common stock to $15 from $13.5. EPS estimates for the full year 2021 and 2022 were cut to $1.19 and $1.39, from $1.20 and $1.42, respectively.