Is Hercules Capital, Inc. (HTGC) A Good Stock To Buy Now?

Is HTGC a good stock to buy? We came across a bullish thesis on Hercules Capital, Inc. on Compounding Dividends’s Substack by TJ Terwilliger. In this article, we will summarize the bulls’ thesis on HTGC. Hercules Capital, Inc.’s share was trading at $14.06 as of March 26th.  HTGC’s trailing and forward P/E were 7.66 and 7.87 respectively according to Yahoo Finance.

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Hercules Capital, Inc. (HTGC) is the largest business development company (BDC) focused on providing financing to high-growth, venture capital-backed companies, particularly in technology, life sciences, and renewable energy. Founded in December 2003 and going public in June 2005, Hercules has a market capitalization of $3.01 billion and an enterprise value of $5.15 billion, with a net asset value (NAV) per share of $12.13 as of December 31, 2025.

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The company manages a $4.26 billion debt investment portfolio spanning 127 companies, with short-term maturities of 36–48 months and investment sizes ranging from $5 million to $500 million, generating an effective yield of 12.9%. A distinguishing feature of Hercules’ strategy is its warrant portfolio, which includes holdings in 108 companies and equity stakes in 74 companies, providing substantial upside if portfolio companies go public or achieve high valuations.

Hercules maintains strong liquidity, with $525.5 million available for new investments and a GAAP leverage of 104.4% (88.6% excluding SBA), and carries investment-grade ratings from Fitch (BBB-), Moody’s (Baa2), DBRS (BBB high), and KBRA (BBB+). The company benefits from a floating-rate portfolio that captures upside from rising interest rates and a high-quality client base backed by top-tier venture capital firms.

Hercules also offers investors a compelling dividend yield of 13.4% and trades at a premium price-to-NAV of 1.16x, reflecting confidence in the management team and its ability to generate outsized returns through a combination of interest income and equity upside from warrants. Overall, Hercules presents a unique investment opportunity in venture debt with strong risk-adjusted returns.

Previously, we covered a bullish thesis on BlackRock, Inc. (BLK) by Kroker Equity Research in February 2025, which highlighted diversified asset management, strong inflows, and the Aladdin® platform. BLK’s stock price has depreciated by approximately 2.37% since our coverage due to broader market volatility. TJ Terwilliger shares a similar view on Hercules Capital, Inc. (HTGC) but emphasizes venture debt exposure, high dividends, and equity upside from warrants.