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Dividend Increases For The High-Yield BDC Sector: Part 2

Published Sun, 10 Feb 2019 09:36:03 -0500 on Seeking Alpha

Business development companies, or BDCs, have begun reporting results, and this article discusses some of the items that investors should be watching.

Sources: SEC Filings and www.bdcbuzz.com.
In December 2018, I purchased additional shares of multiple 'oversold' higher-quality BDCs with risk-averse balance sheets prepared for a potential economic slowdown including Ares Capital (ARCC) at $15.27 for the reasons discussed in this article.
As investors jump back into financial stocks, the average BDC has easily outperformed the S&P 500 so far in 2019, but still has an average dividend yield of around 10.4%. It should also be noted that the average BDC continually outperforms high-yield corporate bond ETFs such as the iShares iBoxx $ High Yield Corporate Bond ETF (HYG) and the SPDR Bloomberg Barclays High Yield Bond ETF (JNK), and UBS ETRACS Wells Fargo Business Development Company ETN (BDCS).

Sources: SEC Filings and www.bdcbuzz.com.
Over the last eight weeks, I have had focus articles discussing MRCC, GAIN, OCSL, CGBD, FSK, HTGC, TPVG, GSBD, TCRD, PSEC, and PNNT.
ARCC had better price performance through December 31, 2018, and was not as oversold going into 2019 which is likely why it has not appreciated as much as the others.
It is interesting to note that BDCs with exposure to collateralized loan obligations (CLOs) such as PSEC, KCAP, and OXSQ are not having a good year so far.
BDC Dividend Changes For 2019
As mentioned in many... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
THL CREDIT 6.59   0.0 -0.51 0.84 12.52
MONROE CAPITAL 11.52   19.9 0.58 1.40 11.85
PENNANTPARK INVESTMENT 6.36   14.1 0.45 0.72 11.15
APOLLO INVESTMENT 16.29   16.1 1.01 1.80 11.11
KOHLBERG CAPITAL 3.75   0.0 -0.25 0.40 11.05
PROSPECT CAPITAL 6.33   10.6 0.60 0.72 10.96
OAKTREE SPECIALTY LENDING 4.90   0.0 -1.39 0.50 10.02
HERCULES TECH GROWTH CAP 12.83   9.0 1.42 1.28 9.91
FIDUS INVESTMENT 15.92   8.5 1.87 1.56 9.89
TCP CAPITAL 14.43   20.0 0.72 1.44 9.80
PENNANTPARK FLOATING RATE CAPITAL 11.62   29.0 0.40 1.14 9.74
GOLDMAN SACHS BDC 19.83   21.3 0.93 1.80 9.12
GLADSTONE CAPITAL 9.42   31.4 0.30 0.84 8.97
MEDLEY CAPITAL 2.50   0.0 -1.55 0.20 7.87
GOLUB CAPITAL BDC 17.82   14.6 1.22 1.28 7.26
GLADSTONE INVESTMENT 11.70   4.7 2.48 0.82 6.99
MAIN STREET CAPITAL 41.52   14.4 2.89 2.40 5.91
SPDR BARCLAYS CAPITAL HIGH YIELD BOND ETF 107.88   0.0 0.00 6.08 5.64
ISHARES IBOXX $ HIGH YIELD CORPORATE BOND FUND 86.35   0.0 0.00 4.59 5.32
 

THL CREDIT - TCRD
THL CREDIT - TCRD  


Older articles featuring Thl Credit (TCRD):
10% Yielding New Mountain Finance Receives Fitch Rating
Dividend Increases For The High-Yield BDC Sector, Part 6: Gladstone Investment
Dividends By The Numbers For March 2019 And 2019-Q1
Apollo Investment: 12% Yield Supported By Improving Portfolio Quality
69 10%+ Dividend Yield WallStars Portend Ides Of March Fortunes
Dividend Increases For The High-Yield BDC Sector, Part 5: BlackRock TCP Capital
Strong Buy With 12% Yield With 30%+ Return Potential: TCG BDC
Dividend Increases For The High-Yield BDC Sector, Part 4: Main Street Capital
March Magic 10%-Plus Yield Dividend WallStars Flaunt Gains, Yields And Prices
Dividend Increases For The High-Yield BDC Sector, Part 3: TPG Specialty Lending

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