Value
9.6/10data confidence 50%| Component | Sub-score |
|---|---|
| P/S | 9.0 |
| Fwd P/E | 10.0 |
| PEG | 10.0 |
- ▸Forward P/E: 3.4x
- ▸PEG: 0.03
- ▸Attractively valued
ECC · Why this verdict
Why Eagle Point Credit Company (ECC) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. People who build TrendMatrix, or entities they control, may hold positions, long or short, in securities it covers, and may trade them at any time. Positions are not disclosed individually. Verdicts are generated by an automated model applied by the same rules to every covered stock, and are not adjusted for any position held by the people who build TrendMatrix. We do not accept payment from issuers for coverage.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictHOLD
Overall score5.5/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
ECC combines a high-asymmetry recovery setup (87% upside, improving MACD) and an attractive forward valuation with a still-confirmed price downtrend and a failing Rule of 40 growth-profitability read.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The fund screens as attractively valued on a forward basis (P/E 4.9x, PEG 0.03), supporting the bull case alongside a strong 8/9 Piotroski F-Score. Bull case | The value score should remain in the top decile and the Piotroski F-Score should hold at 7 or above. | →Stable |
| CounterA very low forward P/E for a credit-focused closed-end fund can reflect NAV/discount dynamics tied to portfolio credit risk rather than a genuine earnings-based bargain. | ||
The engine flags a very high asymmetry ratio (9.61) with 87% upside to price target, occurring within a RECOVERY setup where MACD is improving despite a prior death cross. Reward-to-risk math | The asymmetry ratio should remain elevated (above 3.0) as price recovers toward the target over the next 12 months. | →Stable |
| CounterThe stock remains below its 200-day moving average in a confirmed downtrend (MA slope -5.5%/30d), so the recovery read could reverse before the large modeled upside materializes. | ||
The stock remains in a confirmed downtrend, trading below its 200-day moving average with a negative MA slope of -5.5%/30d. Bear case | Price should reclaim the 200-day moving average and the MA slope should turn positive within the next two quarters. | ↑Improving |
| CounterThe setup is explicitly classified as RECOVERY with improving MACD, suggesting the downtrend may already be in its final stages. | ||
The fund fails the Rule of 40 threshold (score of 14 vs. the 40 pass bar), reflecting a weaker combined growth-plus-profitability profile even as FCF stays positive. Quality breakdown | The Rule of 40 score should rise above 25 as revenue trends or profitability improve. | →Stable |
| CounterRule of 40 is designed for growth/SaaS-style operating companies, and applying it to a credit-focused income fund may produce a structurally low score regardless of actual portfolio health. | ||
The fund screens as attractively valued on a forward basis (P/E 4.9x, PEG 0.03), supporting the bull case alongside a strong 8/9 Piotroski F-Score.
→StableBull case
- Expectation
- The value score should remain in the top decile and the Piotroski F-Score should hold at 7 or above.
CounterA very low forward P/E for a credit-focused closed-end fund can reflect NAV/discount dynamics tied to portfolio credit risk rather than a genuine earnings-based bargain.
The engine flags a very high asymmetry ratio (9.61) with 87% upside to price target, occurring within a RECOVERY setup where MACD is improving despite a prior death cross.
→StableReward-to-risk math
- Expectation
- The asymmetry ratio should remain elevated (above 3.0) as price recovers toward the target over the next 12 months.
CounterThe stock remains below its 200-day moving average in a confirmed downtrend (MA slope -5.5%/30d), so the recovery read could reverse before the large modeled upside materializes.
The stock remains in a confirmed downtrend, trading below its 200-day moving average with a negative MA slope of -5.5%/30d.
↑ImprovingBear case
- Expectation
- Price should reclaim the 200-day moving average and the MA slope should turn positive within the next two quarters.
CounterThe setup is explicitly classified as RECOVERY with improving MACD, suggesting the downtrend may already be in its final stages.
The fund fails the Rule of 40 threshold (score of 14 vs. the 40 pass bar), reflecting a weaker combined growth-plus-profitability profile even as FCF stays positive.
→StableQuality breakdown
- Expectation
- The Rule of 40 score should rise above 25 as revenue trends or profitability improve.
CounterRule of 40 is designed for growth/SaaS-style operating companies, and applying it to a credit-focused income fund may produce a structurally low score regardless of actual portfolio health.
Per-dimension breakdown
Quality
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 4.2 |
| Gross margin | 10.0 |
| Op margin | 10.0 |
| Net margin | 0.0 |
| Current ratio | 9.3 |
| FCF quality | 10.0 |
| Moat | 5.5 |
| Rule of 40 | 3.0 |
| Piotroski F | 8.9 |
- ▸FCF-positive despite GAAP loss (FCF margin 33%, FCF yield 17.4%)
- ▸Rule of 40: 11 (fail)
- ▸Strong Piotroski F-Score: 8/9
Growth
2.4/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 0.0 |
| EPS growth | 4.7 |
- ▸Declining revenue: -22%
Momentum
1.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.0 |
| MACD | 3.7 |
| OBV | 1.0 |
| MA position | 1.0 |
| Volume | 0.0 |
- ▸Capitulation risk (RSI 21, below 200MA)
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -6.5%/30d — confirmed downtrend
Sentiment
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 10.0 |
| erm sentiment | 4.8 |
- ▸Analyst upside: 224%
Insider
7.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
- ▸Institutions accumulating
Peer rank
4.4/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 9.2 |
| quality rank | 0.2 |
| growth rank | 0.9 |
Technical
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 8.1 |
| support resistance | 9.9 |
| 52w position | 0.0 |
| gap | 5.0 |
Risk (lower is worse)
7.5/10data confidence 80%| Component | Sub-score |
|---|---|
| short interest | 10.0 |
| volatility | 1.4 |
| beta | 10.0 |
| debt equity | 8.8 |
Catalyst
2.6/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 0.0 |
| surprise avg | 1.3 |
| dividend safety | 4.0 |
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Market cap $348M below $400M minimum. Not in investable universe.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:MARKET_CAPPassed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:NO_DATE
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:1.7<4.5
- DEATH_CROSS:HARD_BLOCK
Warning (1)
- ASYMMETRY:UPSIDE_EXHAUSTED (upside=0.0%)
Reward-to-Risk
0.00
Upside
+0.0%
Downside
8.9%
Sizing output
AVOID
SetupFalling Knife — Death cross, below all MAs, RSI 21, MACD bearish
EdgeInst Constrain — Small cap ($0.3B) below institutional reach
SuitabilitySpeculative — Drawdown -51% (>40% off 52w high)
Investment implication
The HOLD_IF_HOLDING verdict reflects the MOMENTUM gate's 1.7<4.5 outcome against Value at 9.6 and asymmetric R:R of 0.00.
The strongest dimensions are Value at 9.6, Risk (lower is worse) at 7.5, and Insider at 7.3; the weakest are Momentum at 1.7, Growth at 2.4, and Catalyst at 2.6. The V9 engine flagged 2 failed gates with 1 warning, producing an asymmetric reward-to-risk of 0.00 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Asymmetry Recovery Setup
Trip ifAsymmetry ratio falls below 1.5 from the current 9.61.
- P2Attractive Forward Valuation
Trip ifValue score falls below 5.0 from the current 9.2.
- P3Confirmed Price Downtrend
Trip ifMA slope stays below -3%/30d for 2 additional consecutive quarters.
- P4Weak Rule Of 40 Profile
Trip ifRule of 40 score stays below 20 for 2 consecutive quarters.