Keefe Bruyette analyst Ryan Lynch downgraded Horizon Technology Finance to Underperform from Market Perform with a price target of $10.50, down from $11.50. The analyst believes the theme for 2023 in the business development sector will be the “tension between” higher operating return on equities versus higher credit losses. Higher rates are slowing down the economy and increasing expenses for borrowers, which will increase defaults and credit losses, Lynch tells investors in a research note. He expects the venture capital ecosystem to be one of the most impacted sub-sectors from higher rates, which drives the downgrade of Horizon Technology.
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