Not All Venture Debt Dividend Yields Are Safe: Trinity Capital Vs. TriplePoint Venture

Pacifica Yield 14.03K Followers Follow Summary Investor sentiment in venture debt BDCs continues to be shaped by perceived AI-driven risks to software portfolios. TPVG is down 15% over the last year, with TRIN up 13%. TRIN offers an 11.07% annualized yield with monthly distributions, while TPVG pays 580 basis points over this with its 16.9% yield but with coverage at 91% versus 100% from TRIN. TPVG saw NII fall 26.5% year-over-year versus growth of 32.1% for TRIN, with TPVG trading at a deep 37% discount to NAV per share. TRIN trades at a 35% premium. Alllex/E+ via Getty Images Venture debt BDCs have seen gyrating animal spirits this year as the market sought to price and then re-price the risk that AI supposedly poses to software companies. Trinity Capital ( TRIN ) and the externally managed TriplePoint Venture Growth ( This article was written by Pacifica Yield 14.03K Followers Follow The equity market is a powerful mechanism as daily fluctuations in price get aggregated to incredible wealth creation or destruction over the long term. Pacifica Yield aims to pursue long-term wealth creation with a focus on undervalued yet high-growth companies, high-dividend tickers, REITs, and green energy firms. Analyst’s Disclosure: I/we have a beneficial long position in the shares of TRIN either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.