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Preliminary Q2 Results For The BDC Sector Currently Yielding 13%

Published Fri, 17 Jul 2020 11:18:16 -0400 on Seeking Alpha

Seeking AlphaDividend IdeasPreliminary Q2 Results For The BDC Sector Currently Yielding 13%Jul. 17, 2020 11:18 AM ET|| Includes: AINV, ARCC, BKCC, FSK, GARS, GBDC, GLAD, GLADD, GSBD, HTGC, KCAPL, MAIN, MRCC, MRCCL, NMFC, NMFX, ORCC, OXSQ, PFLT, PNNT, PSEC, PTMN, TCPC, TPVG, TSLXby: BDC BuzzBDC Buzz Sustainable DividendsBuild a portfolio with sustainable dividend yields ranging from 8% to 12%SummaryAs expected, BDCs are starting to reaffirm their dividends which is driving some stocks to rally as investors figure out that the sky is not falling in this higher yield sector.
Also, BDCs are reporting increases in portfolio values that will be driving NAV higher for Q2 2020.
This article discusses two BDCs that will likely be reporting stronger-than-expected results in the coming weeks.
Quick BDC Market Update
As mentioned in previous articles, I'm expecting many BDCs to report stronger-than-expected results including net asset value "NAV" increases, adequate dividend coverage, and reaffirming current dividends. Please see "Upcoming NAV Changes For The BDC Sector Yielding 14%" for discussion of why we will likely see many BDCs with increased NAV.
BDCs will start reporting results in less than two weeks and will likely drive some positive headlines and another rally in BDC pricing as investors are looking to improve portfolio yield/returns in this low-yield environment. Please see the end of this article for a special offer to help subscribers get their portfolio in order before earning season.

Clearly the potential for additional or renewed lockdowns related to COVID-19 is a concern driving markets lower, including BDCs that are now yielding over 13% (see list below). It should be noted that the yields for PTMN and BKCC are likely less as PTMN is merging with GARS and BKCC is only paying 20% of its dividend in cash (the rest is in stock). The change to BKCC's dividend was not announced on Seeking Alpha but you can see the release here:
BlackRock... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
BLACKROCK KELSO CAPITAL 5.25   0.0 -0.12 0.56 13.61
MONROE CAPITAL 10.48   18.4 0.57 1.40 13.60
GARRISON CAPITAL 6.94   0.0 -0.17 0.92 13.35
PENNANTPARK INVESTMENT 6.32   21.8 0.29 0.72 11.32
PROSPECT CAPITAL 6.71   16.8 0.40 0.72 10.76
APOLLO INVESTMENT 16.78   14.2 1.18 1.80 10.73
TCP CAPITAL 13.75   29.3 0.47 1.44 10.48
PENNANTPARK FLOATING RATE CAPITAL 11.68   30.0 0.39 1.14 9.81
HERCULES TECH GROWTH CAP 13.26   10.0 1.32 1.28 9.55
GOLDMAN SACHS BDC 20.29   22.5 0.90 1.80 8.88
GLADSTONE CAPITAL 9.50   63.3 0.15 0.84 8.84
ARES CAPITAL 19.19   10.5 1.82 1.60 8.39
GOLUB CAPITAL BDC 18.55   15.7 1.18 1.28 6.89
MAIN STREET CAPITAL 43.18   16.8 2.57 2.46 5.69

BLACKROCK KELSO CAPITAL - BKCC
BLACKROCK KELSO CAPITAL - BKCC  


Older articles featuring Blackrock Kelso Capital (BKCC):
Earn An 8% To 10% Balanced Portfolio Yield Investing In America: Part 1
Quick BDC Market Update: 18% Average Yield But Continued Volatility
Why Investors Are Selling 12% Yielding Monroe Capital
Juul Investor BlackRock TCP Capital Currently Yielding 10.3%
Building A Retirement Portfolio With 6% To 9% Yield: Apollo Investment
Building A Retirement Portfolio With 6% To 9% Yield: Part 5
Building A Retirement Portfolio With 6% To 9% Yield: Part 4
Building A Retirement Portfolio With 6% To 9% Yield: Part 2
Building A Retirement Portfolio With 6% To 9% Yield: Part 1
BIZD: Attractive 9% Yield, But Widening Credit Spreads A Risk

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