Gladstone Capital: One Of The Few Buying Opportunities In The BDC Segment
In December 2023, I opened a position in Gladstone Capital, which I then closed exactly 1 year later, capturing ~40% in total returns. In late 2024, I decided to rotate out because of the aggressive P/NAV relative to the embedded growth prospects. Since then, GLAD has significantly underperformed the index.
BDC Weekly Review: PSEC Is Trying To Turn The Ship Around
We take a look at the action in business development companies through the fourth week of August and highlight some of the key themes we are watching. BDCs delivered their best weekly performance, rallying over 1%, despite market concerns about upcoming Fed rate cuts and sector underperformance. Prospect Capital rallied on signs of a strategic pivot, exiting CLO Equity, selling REIT assets, and planning greater credit facility use.
BDC Weekly Review: Let's Take A Deep Breath On Dividend Coverage
We take a look at the action in business development companies through the fourth week of August and highlight some of the key themes we are watching. Dividend coverage is a mostly optical, not material, metric; investors should focus on portfolio quality, credit issues, and structural factors over headline payout ratios. BCSF delivered solid earnings, with portfolio quality holding up well.
New Mountain Finance: Lackluster Growth Prospects For This BDC
I maintain my hold rating on NMFC due to limited earnings growth and weak distribution coverage, despite its attractive 12.4% dividend yield. NMFC's concentrated portfolio and lack of new investment allocation increase vulnerability to sector-specific risks and limit growth potential. Although NMFC trades at a 15% discount to NAV, this reflects weaker growth prospects rather than a compelling value opportunity.
BDC Weekly Review: Keep An Eye On Valuation-Adjusted Performance
We take a look at the action in business development companies through the third week of August and highlight some of the key themes we are watching. BDCs remain attractive due to sector-wide valuations that are well below historic averages, providing a margin of safety and boosting earnings yield for investors. Valuation-adjusted total NAV return is a key metric—investors should focus on returns relative to valuation, not just headline numbers or wide discounts.
Main Street Capital: I Consider It The Best BDC To Hold
Main Street Capital remains my top BDC due to its resilience, internally-managed structure, and consistent dividend growth, but I reiterate a 'hold' rating. MAIN's distributable NII and NAV continue to grow despite sector headwinds, thanks to its more optimal debt structure and cost advantages. The premium to NAV is high—over 100%—making new purchases unattractive, but this premium enables MAIN to raise cheap capital and drive long-term value.
BDC Weekly Review: BDC Earnings Deluge
We take a look at the action in business development companies through the second week of August and highlight some of the key themes we are watching. BDCs traded flat this week, with earnings reports driving sector movement; valuations remain attractive versus historical averages. Recent earnings highlight strong performance from FDUS and NCDL.
Crescent Capital BDC: Best Deep Value Play In The BDC Sector
Crescent Capital BDC, Inc.'s Q2 results showed improved net investment income per share, outperforming peers and maintaining strong base dividend coverage at 110%, above sector average. Despite a higher debt-to-equity ratio and limited equity upside, CCAP's fundamentals are in line with or better than the sector average. Yet, the stock trades at a massive discount to NAV (~21%), far steeper than the sector average, creating an attractive risk-reward profile.
Barings BDC: Remains Resilient But Not A Buy Yet
Barings BDC's portfolio is heavily weighted toward first lien loans, providing a strong foundation for risk management and income stability. BBDC offers a starting dividend yield of 10.7%, which is supported by net investment income at a coverage rate of 107%. Q2 earnings highlight a stable risk profile. Earnings remain on par with prior quarters and financials are healthy.
Chicago Atlantic BDC, Inc. (LIEN) Q2 2025 Earnings Call Transcript
Chicago Atlantic BDC, Inc. (NASDAQ:LIEN ) Q2 2025 Earnings Conference Call August 14, 2025 9:00 AM ET Company Participants Bernardino M Colonna - President Peter S. Sack - Chief Executive Officer Thomas Napoleon Geoffroy - Interim Chief Financial Officer Tripp Sullivan - Corporate Participant Conference Call Participants Operator Good day, and welcome to the Chicago Atlantic BDC, Inc. Second Quarter 2025 Earnings Call.
Kayne Anderson BDC: Q1 Earnings Reveal The Dividend Isn't As Safe
I maintain my hold rating on KBDC due to weaker earnings and questionable dividend coverage despite a high yield and portfolio resilience. KBDC's portfolio remains defensively structured with low non-accruals, but rising PIK interest income signals borrower stress in a high-rate environment. Earnings and NAV have stagnated, expenses are rising, and capital deployment into new investments is at a twelve-month low, limiting growth prospects.
BDC Weekly Review: Tight Spreads Keep A Lid On Net Income
We take a look at the action in business development companies through the first week of August and highlight some of the key themes we are watching. BDCs underperformed despite strong early earnings, with sector valuations dipping below historical averages. Tight lending spreads continue to pressure BDC net income.
