Eagle Point Credit Company Inc.

For Q2 2026, Eagle Point reported NAV of $4.51 per share, up 8% from $4.17 at March 31. GAAP return on common equity was 12.7%, and GAAP net income was $70 million, or $0.53 per share, versus a GAAP net loss of $1.12 per share in Q1 2026 and GAAP net income of $0.47 per share in Q2 2025. NII was $0.17 per share; NII less realized losses was -$0.62 per share, versus $0.14 in Q1 2026 and $0.16 in Q2 2025. Recurring cash flows totaled $62 million, or $0.47 per share, and exceeded common distributions and total expenses by $0.14 per share. The company paid $0.18 per share in cash distributions during the quarter and declared monthly common distributions of $0.06 per share for the remainder of 2026. Forward-looking, management said July month-end NAV was estimated at $4.33 to $4.43 per share, with the midpoint about 3% below quarter-end, and said leverage was 47% of total assets less current liabilities at June month-end, above the 27.5% to 37.5% target range, with a plan to move back into range over time.

Tom Majewski said the quarter’s NAV recovery was driven mainly by a rebound in loan prices and CLO equity valuations after first-quarter volatility tied to AI concerns, software borrower uncertainty, and geopolitics. He emphasized that underlying credit fundamentals remained resilient and argued that much of the earlier decline was market-driven rather than a broad deterioration in credit. He also highlighted active portfolio management, including resets/refinancings, the scaling Muzinich partnership in Europe, and growing access to non-CLO opportunities across the Eagle Point platform.

Ken Onorio said Q2 NII was $0.17 per share and recurring cash flows were $62 million, or $0.47 per share, enough to cover distributions and expenses by $0.14 per share. He noted the company paid three monthly dividends of $0.06 per share and expects that level to continue for the remainder of 2026, which he said is aligned with earnings and intended to support a sustainable distribution. He also said the company completed full redemption of ECCW and ECCX notes, has no financing maturing before January 2029, and that debt and preferred equity were 47% of total assets less current liabilities, above the 27.5% to 37.5% target range, with leverage expected to come down over time.

Analysts focused on whether loan spread compression had really abated, how sustainable that would be, and what was driving the improvement. Management said the effect is largely supply-and-demand driven, with slower CLO issuance, more loans trading at discounts, and some software loans seeing wider spreads in exchange for maturity extensions; Tom said spreads were roughly flat quarter over quarter and some loans were even moving wider. Questions also centered on the growing non-CLO and infrastructure sleeves and the underperforming managers being rotated out; Tom said non-CLO yields are roughly in the low twenties, that there is no fixed target for the mix, and that manager exits were based on par burn, value destruction, and persistent underperformance, with the firm now using a dedicated quant to improve early identification.