Eaton Vance Senior Floating-Rate Fund

EFR

Market cap $330M

Energy Fuels advanced faster than I expected, showing in 2025 a company already executing production, costs and rare earths with a consistency that reshapes its position in the sector. Results reflect more volume, better feed, falling costs and a balance sheet that now supports real scaling rather than just sustaining operations as in prior years. Within a sector trading at geopolitical and strategic premiums, UUUU still sits at a valuation that does not fully reflect its growth, cost trajectory or the scale of its rare.

The Triple-Factor CEF Report screens over 400 funds for high yield (>6.5%), strong coverage (>90%), and discount to NAV, balancing yield, sustainability, and value. Top lists include funds with widest discounts, best z-scores, highest yields, and best combined metrics, offering potential for price appreciation and enhanced yields. Explore top lists for further research; these shortlists are not final buy/sell recommendations. Always verify coverage ratios with official fund documents.

This report screens ~400 closed-end funds for those with distribution coverage above 100%, aiming to identify lower-risk income opportunities for investors. Key metrics include premium/discount, z-score, leverage, baseline expense, and coverage. Top picks feature funds that offer high yields, deep discounts, and strong coverage, highlighting attractive value and income potential.

This report screens ~400 closed-end funds (CEFs) for those with 100%+ net investment income coverage, highlighting lower risk of distribution cuts. Top lists identify CEFs with the widest discounts, most attractive z-scores, highest covered yields, and best combinations of value and income. Investors are encouraged to use these rankings as a starting point for due diligence, not as final buy or sell recommendations.

Energy Fuels Inc. (UUUU) has experienced significant volatility, with a sharp drawdown followed by a strong rally. Down 50% and up 180% within a year. They remain the US's largest uranium producer and are expanding their rare earth mines, as well as increasing their capacity. UUUU stands to benefit from the nuclear renaissance, both from the fundamental shifts in global supply and also the political catalysts from the current US administration.

EFR offers an attractive 8.7% yield from floating rate debt, providing income and some protection against equity volatility. The fund is highly diversified but concentrated in below investment grade loans, exposing investors to credit risk and potential defaults. With likely interest rate cuts ahead, EFR's net investment income and dividend sustainability are at risk, making future payouts less certain.

Diversification across bonds, senior loans, and CLOs is key to managing interest rate and credit risks in fixed-income portfolios. Market timing is extremely difficult; a balanced mix of fixed and floating-rate assets provides resilience regardless of rate direction. Distribution cuts in floating-rate CEFs are expected as rates fall but should be weighed against opportunity cost and risk-adjusted returns.

We initially rated Eaton Vance Senior Floating-Rate Trust a 'Sell' due to overvaluation; it has since dropped 17%, now reflecting fair value. The CEF's discount to NAV has decreased by 12% recently, making it historically cheap but still vulnerable to interest rate cuts. EFR is heavily composed of floating rate loans with a 36% gearing ratio, amplifying both gains and losses, but NAV losses remain modest.

We review the CEF market valuation and performance through the first week of February and highlight recent market action. CEFs had a strong week, with most sectors in the green, driven by EM Equity and Muni sectors, and year-to-date gains in both NAVs and discounts. We take a look at why preferred CEFs have sharply outperformed their ETF counterparts last year.

EFR is currently overpriced, trading at a premium to NAV, which has only occurred three times in the past decade. Despite its 35% leverage, the Fund's 9.3% yield is insufficient compared to unleveraged alternatives like LONZ and FTSL. Investors should consider selling Eaton Vance Senior Floating-Rate Trust and explore alternatives like PIMCO Senior Loan ETF, First Trust Senior Loan ETF, or Nuveen Floating Rate Income Fund.