Goldman Sachs BDC, Inc. (GSBD)

The BDC sector faces mounting risks from a weakening economy, high consumer debt, and the potential for further dividend cuts as interest rates decline. Recent dividend cuts by several BDCs highlight the sector's vulnerability, despite some names maintaining resilience and attractive valuations. Spillover income offers only limited protection; tight dividend coverage and rising non-accruals signal caution for income-focused investors.

Richard Kim was indicted on securities and wire fraud charges related to alleged misappropriation of about $4 million in investor funds for his start-up online casino company, Zero Edge. Kim, who previously was an executive at Goldman Sachs and JPMorgan Chase, lost most of that money within a week through gambling on another site, court filings state.

Q2 earnings confirmed my call for a market rotation in BDCs; quality bias and selectivity remain critical for outperformance. Structural headwinds—spread compression, falling base rates, and thin dividend coverage—signal elevated risk of further dividend cuts across the sector. Current sector repricing is insufficient for broad new BDC allocations; most remain unattractive except for select names with strong fundamentals.

Goldman Sachs BDC (GSBD) Q2 2025 Earnings Call Transcript

Goldman Sachs BDC (GSBD) came out with quarterly earnings of $0.38 per share, missing the Zacks Consensus Estimate of $0.4 per share. This compares to earnings of $0.57 per share a year ago.

NEW YORK--(BUSINESS WIRE)--Goldman Sachs BDC, Inc. (“GSBD”, the “Company”, “we”, “us”, or “our”) (NYSE: GSBD) today reported financial results for the second quarter ended June 30, 2025 and filed its Form 10-Q with the U.S. Securities and Exchange Commission. QUARTERLY HIGHLIGHTS Net investment income per share for the quarter ended June 30, 2025 was $0.38. Excluding purchase discount amortization per share of $0.01 from the Merger (as defined below), adjusted net investment income per share wa.

Dividend cuts are rising as companies face persistent high interest rates, inflation, and changing consumer behavior, impacting even long-standing dividend payers. Carter's slashed its dividend by 69% due to deteriorating financials, tariff uncertainty, and a challenging macro environment, despite a strong balance sheet. Pepsi, a Dividend King, is experiencing cash flow issues; while recent acquisitions are promising, a dividend cut is possible if headwinds persist or a recession hits.

Goldman Sachs BDC's recent quarters have disappointed, with declining earnings and NAV, justifying my continued Hold rating despite attractive yield and discount. Dividend cuts, rising non-accruals, and realized losses highlight ongoing portfolio and credit quality issues, outweighing any positives from special dividends. Improvements in non-accruals and leverage are minor, while upcoming debt refinancing and potential rate cuts threaten further earnings and dividend coverage.

GSBD offers a 10.85% base dividend yield. This yield is being expanded with special and supplemental dividends. Fiscal 2025 first quarter earnings saw dual misses and a decline in NAV per share, with net investment income unable to fully cover the aggregate dividend payouts. The portfolio remains defensive with low non-accruals, but negative net funded investment activity and falling rates threaten future total investment income.

I focus on dividend investing to build a reliable income stream, prioritizing companies with strong fundamentals and consistent dividend growth. Old Republic International stands out for its robust earnings, special dividends, and over 40 years of dividend increases, trading at an attractive valuation. Ares Capital offers a high yield, strong liquidity, and a history of stable dividends, making it a solid choice for income-focused investors.

Key Points The bank consolidations caused by the 2008 subprime mortgage banking meltdown wound up favoring large corporations for ongoing business at the expense of smaller ones. The Business Development Company sector has filled the debt financing gap for small and medium sized businesses abandoned by the large banks after 2008. Due to BDC registration requirements for capital markets access, shareholders receive 90% of BDC profits, often resulting in double digit annual yields. It’s hard to believe, but today there are credit cards offering up to 6% cash back, $200 statement credits, $0 annual fees, travel rewards, and more. See for yourself, I couldn’t believe it at first. Frankly, with rewards this good we don’t expect them to be available forever. But if you sign up today you can secure some of the best rewards we’ve ever seen. Click here to get started. Prior to 2008, some of the more popular US banking institutions included: Lehman Brothers Bear Stearns Wachovia Bank Washington Mutual Merrill-Lynch IndyMac As depicted in the 2015 movie, The Long Short, the unsustainable subprime mortgage bubble wound up causing a banking industry meltdown. All of the banks in the list above despite decades of successful operations, were caught flatfooted and insolvent when the crash hit. The federal government was forced to trigger TARP (Troubled Asset Relief Program) which helped to shore up the balance sheets of the largest institutions. The leftover banks were steered towards the TARP recipients for acquisition, with Bear Stearns most notably being acquired by JP Morgan Chase at a fire-sale price of $2 per share. Unsurprisingly, turning around operations to remove red ink from balance sheets became the imperative of all of these new consolidated banks. For example, Brian Moynihan of Bank of America, which acquired Merrill-Lynch, issued a directive for brokers to close out accounts smaller than $200,000. An unforeseen casualty of the bank consolidations were the small and medium sized businesses that had been relying on the Washington Mutuals, et al. for their revolving credit lines, their inventory finance, and a panoply of other debt finance services. With millions of medium and small businesses suddenly stuck without financing options, Business Development Companies (BDCs) emerged to fill the gap, which has subsequently created a sizable standalone BDC category estimated to be over $350 billion and part of the larger $1.8 trillion private credit sector. As BDCs are registered with the SEC, they are treated comparably to REITs and thus, shareholders receive 90% of BDC profits. The five BDC examples below give a good example of the demand strength in the sector and the boost to entrepreneurship and business creation and the yields each offers investors. WhiteHorse Finance, Inc. WhiteHorse Finance has provided over $2.78 billion worth of financings since 2012, with a partiality to software companies. WhiteHorse Finance, Inc. (NASDAQ: WHF) Yield: 17.66% WhiteHorse Finance, Inc. is a Business Development Company that finances lower and mid-tier companies with growth capital in the form of senior secured notes or first lien notes. Headquartered in Miami, FL, WhiteHorse typically originates its debt underwritings in the $25 million to $50 million range for US companies in the $50 million to $350 million enterprise value category. It has deployed its $642 million portfolio to finance $2.78 billion across 260 transactions since going public in 2012. Goldman Sachs BDC, Inc. Investment banking behemoth Goldman Sachs has a BDC industry presence under its own moniker. Goldman Sachs BDC, Inc.(NYSE: GSBD) Yield: 14.13% The lucrative profits that well financed firms can avail themselves of in the BDC space have caused some of the aforementioned larger banks to get a foothold into it as well, after abandoning it years ago. Goldman Sachs is one of them. MSNBC’s Jim Cramer described Goldman Sachs recently as a firm with “a thirst that can’t be slaked without more deals.” Journalist Matt Taibbi dubbed Goldman Sachs, the prestigious (some would say nefarious) investment bank with the nickname, “Great Vampire Squid” due to it being “wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money” and its omnipresent shadow on any financial platform where money can be made. The self-descriptive Goldman Sachs BDC, Inc. represents the Goldman Sachs BDC footprint. Stellus Capital Investment Corporation Orthotics producer Dr. Scholl’s is one of Stellus Capital Management’s 350+ financing clients. Stellus Capital Investment Corporation (NYSE: SCM) Yield: 11.47% Participating in both the private corporate debt and equity markets, Houston, TX headquartered Stellus Capital Investment Corp. finances deals for American and Canadian companies with EBITDA between $5 million and $50 million. With a $3.4 billion AUM warchest, Stellus has invested over $9.8 billion across 350+ investments since beginning over 20 years ago. The company currently has over 100 financings currently active. Carlyle Secured Lending, Inc. Carlyle Secured Lending is the BDC arm of Carlyle Group, best known for its financings in the aerospace and defense industries. Stock: Carlyle Secured Lending, Inc. (NASDAQ: CGBD) Yield: 12.93% Best known for its involvement with its aerospace and defense industry investments, NY based Carlyle Group has stakes in a number of other financial platforms. With a multi billion portfolio, Carlyle Secured Lending, Inc. is Carlyle Group’s entry into the BDC arena. Golub Capital BDC Inc. Small businesses and private credit financings that might be too small for most BDCs make up a sizable portion of Golub Capital’s clientele, and have helped it to earn its numerous awards. Golub Capital BDC Inc. (NASDAQ: GBDC) Yield: 10.65% Golub Capital BDC Inc. has an unbroken award winning decade-long streak in process, with its 2024 Lender of the Year win. In 2023, Golub Capital won all three Lender of the Year, Senior Lender of the Year, and BDC Manager of the Year in the Americas awards from Private Debt Investor (PDI), and has won 24 PDI awards since 2013. Its latest acknowledgement came this year from Newsweek, which listed Golub Capital BDC in its “America’s Greatest Midsize Workplaces” rankings. The post US Private Credit Surges to Record $1.8 Trillion as BDCs Fill $350 Billion Financing Gap appeared first on 24/7 Wall St..

NEW YORK--(BUSINESS WIRE)--Goldman Sachs BDC, Inc. (“GS BDC”) (NYSE: GSBD) announced today that it will report its second quarter ended June 30, 2025 financial results after the market closes on Thursday, August 7, 2025. GS BDC will also host an earnings conference call on Friday, August 8, 2025 at 9:00 am Eastern Time to discuss its financial results. All interested parties are invited to participate via telephone or the audio webcast, which will be hosted on the Investor Resources section of.

Since the announcement of tariffs in early April, the BDC market has become a less interesting place for capital deployment (as we can imply from higher discounts). Yet, as it is usually the case, higher discounts mean more opportunities for patient investors. In this article, I discuss two 10%+ yielding BDCs, which, even before the uncertainty level spiked higher, were bargains and now have become even more attractive buys.

Currently, an average BDC trades at an 8% discount to NAV. However, those with high dividend cut probabilities have 20%+ discounts. Many of these heavily punished BDCs are busts.

Investing based on brand is not the wisest thing one could do. Yet, in certain sectors, including in the BDC space, strong brands could indicate interesting opportunities. In this article, I share how well-established BDC origination partners could help create durable value for shareholders.

Goldman Sachs BDC delivered weaker-than-expected Q1'25 net investment income amid a shrinking portfolio and persistent non-accrual issues. The BDC's non-accrual percentage improved to 1.9% Q/Q and Q1'25 was the third consecutive quarter of improving balance sheet quality. Goldman Sachs BDC has changed its dividend setup, however, and has more payment flexibility going forward.