Dividend-News

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Main Street Capital's Dividend Sustainability Through June 2020 (Includes Special Periodic Dividend Projection)

Published Wed, 11 Sep 2019 02:57:46 -0400 on Seeking Alpha

Author's Note: This article is a very detailed analysis of Main Street Capital Corp.'s (MAIN) dividend sustainability. I have performed this analysis due to the continued number of readers who have specifically requested such an analysis be performed on MAIN at periodic intervals. For readers who just want the summarized conclusions/results, I would suggest scrolling down to the "Conclusions Drawn" section at the bottom of the article.
Focus of Article
The focus of this article is to provide a detailed analysis with supporting documentation (via three tests) on the dividend sustainability of MAIN through June 2020. This analysis will be provided after a brief overview of MAIN's regulated investment company ("RIC") classification per the Internal Revenue Code ("IRC"). The first two tests will focus on MAIN's net investment company taxable income ("ICTI") and the company's undistributed taxable income ("UTI"). These two tests will be termed "TEST 1" and "TEST 2". The third test will focus on MAIN's unrealized appreciation on investments account and be termed "TEST 3". After these three tests, I will also include a discussion of MAIN's fairly recently announced change when it comes to the company's monthly and special periodic dividend per share rates over the next several years.
Understanding the tax and dividend payout characteristics of MAIN will provide investors with an overall better understanding of the business development company ("BDC") sector as a whole. From... Read more

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OAKTREE SPECIALTY LENDING 4.90   0.0 -1.39 0.50 10.02
PENNANTPARK FLOATING RATE CAPITAL 11.68   30.0 0.39 1.14 9.81
ARES CAPITAL 19.19   10.5 1.82 1.60 8.39
NEWTEK BUSINESS SERVICES 22.91   0.0 0.00 2.32 8.09
SOLAR CAPITAL 20.87   12.4 1.69 1.64 7.93
OAKTREE STRATEGIC INCOME 8.10   19.8 0.41 0.62 7.51
GOLUB CAPITAL BDC 18.55   15.7 1.18 1.28 6.89
GLADSTONE INVESTMENT 12.34   7.4 1.67 0.82 6.73
MEDLEY CAPITAL 2.61   0.0 -1.62 0.15 5.81
BLACKROCK 434.75   16.5 26.34 13.20 3.08