Oaktree Specialty Lending

Oaktree Specialty Lending Corp. is a specialty finance company, which engages in the provision of customized, one-stop credit solutions to companies with limited access to public or syndicated capital markets. Its portfolio include first lien, second lien, kemper jv, and equity. The company was founded on February 15, 2007 and is headquartered in Los Angeles, CA.

Earnings data Q2 2021

Earnings data Q3 2021

Earnings data Q4 2021

Earnings data Q1 2022

Earnings data Q2 2022

Earnings data Q3 2022

Earnings data Q4 2022

Earnings data Q1 2023

Earnings data Q2 2023

Earnings data Q3 2023

Earnings data Q4 2023

Earnings data Q1 2024

Earnings data Q2 2024

Earnings data Q3 2024

Earnings data Q4 2024

Earnings data Q1 2025

Oaktree Specialty Lending navigates challenges, eyes strategic opportunities ahead

Oaktree Specialty Lending faced challenges in Q3 2024 with a slight decline in adjusted NII and increased nonaccruals, yet maintained strong liquidity and a selective investment strategy. The company remains optimistic about future investment opportunities.

Oaktree Specialty Lending (OCSL) reports stable earnings and strategic growth

Oaktree Specialty Lending (OCSL) delivered stable financial performance in Q4 2024, with a strong full-year fiscal 2024 outcome.
The company showcased financial strength with a healthy balance sheet, robust investment activity, and a well-diversified portfolio.
Challenges lie in navigating market uncertainties and addressing analyst concerns, while opportunities abound in seizing new investments and optimizing performance.
With a strategic leadership update and key investments, OCSL is poised to leverage its strengths and capitalize on emerging opportunities.

Revenue

Cost of revenue

Gross profit

Operating expenses

SG&A

Other

Operating income

EBITDA

Net income

Earnings per share

Total assets

Current assets

Cash & equivalents

Receivables

Inventory

Non-current assets

Net PPE

Intangibles

Total liabilities

Current liabilities

Short term debt

Income tax payable

Non-current liabilities

Long-term debt

Total equity

Stockholders equity

Minority interest

Total liabilities & equity

Total debt

Net debt

Book value per share

Cash from operations

Funds from operations

Change in working capital

Cash from investing

Capital expenditure

Purchase/sale of investments

Purchase/sale of business

Other sources

Cash from financing

Change in stock

Change in debt

Cash dividends paid

Cash from other sources

Net change in cash

Free cash flow

VanEck Vectors BDC Income ETF

CION Investment Corp

Sky-high dividends of 13-14% are appealing but often come with significant risks. I discuss two stocks that have fully covered 13% and 14% yields that have a lot going for them and look deeply undervalued. However, I believe their dividends are at risk of getting cut soon.

Dividend Cut Alert: 13-14% Yields Getting Too Risky

Oaktree Specialty Lending Corporation (NASDAQ:OCSL ) Q4 2024 Results Conference Call November 19, 2024 11:00 AM ET Company Participants Dane Kleven - Head of Investor Relations Matt Pendo - President Armen Panossian - Chief Executive Officer & Chief Investment Officer Chris McKown - Chief Financial Officer & Treasurer Conference Call Participants Paul Johnson - KBW Melissa Wedel - JPMorgan Operator Welcome, and thank you for joining Oaktree Specialty Lending Corporation's Fourth Fiscal Quarter Conference Call. Today's conference call is being recorded.

Oaktree Specialty Lending Corporation (OCSL) Q4 2024 Earnings Call Transcript

Although the revenue and EPS for Oaktree Specialty Lending (OCSL) give a sense of how its business performed in the quarter ended September 2024, it might be worth considering how some key metrics compare with Wall Street estimates and the year-ago numbers.

Compared to Estimates, Oaktree Specialty Lending (OCSL) Q4 Earnings: A Look at Key Metrics

Oaktree Specialty Lending (OCSL) came out with quarterly earnings of $0.55 per share, missing the Zacks Consensus Estimate of $0.56 per share. This compares to earnings of $0.62 per share a year ago.

Oaktree Specialty Lending (OCSL) Misses Q4 Earnings and Revenue Estimates

LOS ANGELES, CA, Nov. 19, 2024 (GLOBE NEWSWIRE) -- Oaktree Specialty Lending Corporation (NASDAQ: OCSL) (“Oaktree Specialty Lending” or the “Company”), a specialty finance company, today announced its financial results for the fiscal quarter and year ended September 30, 2024.

Oaktree Specialty Lending Corporation Announces Fourth Fiscal Quarter and Full Year 2024 Financial Results and Declares Quarterly Distribution of $0.55 Per Share

Capital Southwest

Fidus Investment

Goldman Sachs BDC

Horizon Technology Finance

New Mountain Finance

Blue Owl Capital Corp

Blue Owl Capital Corp III

Prospect Capital

TCP Capital

Triplepoint Venture Growth BDC

Sixth Street Specialty Lending

We take a look at the action in business development companies through the second week of November and highlight some of the key themes we are watching. BDCs saw a 2% aggregate return on the week; TPVG surged nearly 20%, while PSEC dropped due to a bad quarter and distribution cut. Tax-loss season may pressure some securities; PSEC, HRZN, TPVG, TCPC, OCSL, GSBD, NMFC, and CSWC could weaken further by year-end.

BDC Weekly Review: Tax-Loss Season Is Approaching

OCSL is a business development company oriented around debt investments (predominantly first-lien debt). Its seemingly defensive portfolio has struggled with rising non-accruals in 2024, resulting in decreasing NAV. Investors might be tempted by a relatively high yield, but they should be wary of the dividend coverage risk.

Oaktree Specialty Lending's Distributions May Be In Trouble

Ares Capital

Hercules Capital

Main Street Capital

Solar Capital

Typically, stocks with at-risk dividends should be avoided. That said, there are exceptions to every rule. I share two high-yielding stocks that look like attractive buys to me even though their dividends could very possibly be cut in the near future.

Dividend Cut Alert For 2 Deeply Undervalued 11%+ Yields

Oaktree Specialty Lending insider Phyllis Caldwell added to her position last month. Other Oaktree insiders have been adding since 2022. The last insider sale was all the way back in 2021.

Oaktree Specialty Lending: The Insider Buying Is Bullish

11:00 a.m. Eastern Time / 8:00 a.m. Pacific Time LOS ANGELES, CA, Oct. 07, 2024 (GLOBE NEWSWIRE) -- Oaktree Specialty Lending Corporation (NASDAQ:OCSL) (“Oaktree Specialty Lending” or the “Company”) today announced that it will report its financial results for the fourth fiscal quarter and full year ended September 30, 2024 before the opening of the Nasdaq Global Select Market on Tuesday, November 19, 2024.

Oaktree Specialty Lending Corporation Schedules Fourth Fiscal Quarter and Full Year 2024 Earnings Conference Call for November 19, 2024

Oaktree Specialty Lending (OCSL) is downgraded to a sell due to weak distribution coverage and rising non-accrual rates, indicating a potential dividend cut. Despite a solid portfolio strategy, OCSL's net investment income and NAV have declined, with a YTD total return of negative 12.5%. Management has waived their fee in an effort to soften the negative impact of net investment income. However, this is not a sustainable long term practice.

Oaktree Specialty Lending: Dividend Cut Is Imminent

Oaktree Specialty Lending Corporation offers a high dividend yield of 14%, but its book value performance and risky loan portfolio are concerning. Despite a solid market cap and experienced management, OCSL has underperformed, with shares dropping 55% since its IPO and total returns lagging behind peers. Recent management fee reductions are shareholder-friendly, but declining net asset value and rising non-accrual rates indicate significant portfolio risks.

Oaktree Specialty Lending: How Good Is This 14% Yield?

The Fed's recent decision to cut the base rates by 50 basis points has created more problems for BDCs, especially for those with weaker portfolios. Lower base rates, inactive M&A markets and higher economic uncertainty are critical factors that for some BDCs might trigger dividend cuts. In the article I elaborate on two BDCs that are very close to cutting their dividends with a high probability of making the announcements together with their Q4, 2024 reports.

BDC Dividend Cut Alert: 2 BDCs That Are Likely To Cut Dividends

Blackstone Secured Lending Fund

FS KKR Capital Corp

Golub Capital BDC

Morgan Stanley Direct Lending Fund

The Federal Reserve's 50 basis point rate cut impacts BDCs, which are sensitive to short-term rate changes, affecting their net investment income. BDCs thrive during rate hikes but face challenges with rate cuts, potentially leading to declining net investment income and increased non-accruals. I take a look at 10 leading BDCs and share my pick for the best one to own in the current environment.

The Best BDC To Buy For Fed Rate Cuts

Oaktree Specialty Lending: Excess Software Lending May Compound 'Value Trap' Risk

Runway Growth Finance Corp

This is not the right time to take high risk in the BDC space. Yet, as it is often the case, a challenging environment creates opportunities. In this article, I elaborate on two BDCs which indeed have some risks, but not to the extent that is currently priced in by the market.

2 BDCs At Discounts Of ~20% With Attractive Asymmetric Profiles

Vanguard Real Estate ETF

BDCs have outperformed REITs since early 2022 due to rising short-term interest rates and a strong economy, but dynamics shifted in July. With long-term rates declining and recession fears rising, BDCs face dividend cut risk. One BDC recently slashed its dividend aggressively and more are likely to follow.

Dividend Cut Alert: Bad News For BDCs

The BDC sector faces headwinds such as spread compression, potential Fed rate cuts, and increased corporate distress. Despite these challenges, BDC market indices like VanEck BDC Income ETF and Putnam BDC Income ETF show only minor corrections. Yet, the small, illiquid nature of the BDC sector means ETFs may not fully capture overall sector dynamics.

3 Lessons Learned From Struggling BDCs After Q2 Earnings

Oaktree Specialty Lending had a disappointing quarter with a drop in NAV and investment income, but still eked out a positive total NAV return. The management fee was reduced permanently to 1%, which should drive a 6% rise in net income. The NAV fell by 2.8%, marking the third sizable drop in a row and the eighth drop in the last 10 quarters.

Oaktree Specialty Lending: A Series Of Unfortunate Events For This BDC

TCG BDC

The recent BDC market dynamics indicate that quality will play an important role over the foreseeable future. Looking at the recent quarterly earnings data that have been published by many BDCs, we can see a clear divergence between high quality and aggressive BDCs. In this article, I elaborate on two BDCs that have become more attractive for investors, who prioritize defensive and predictable yield.

2 BDCs That Improved And 2 That Got Worse After Q2 Earnings

Oaktree Specialty Lending Corporation's credit profile deteriorated, leading to risks to the dividend. The company barely covered its dividend with net investment income, leading to a potential dividend cut for passive income investors. Oaktree Specialty Lending's net asset value decreased, causing concern about the sustainability of the dividend.

Oaktree Specialty Lending: Risky 13% Yield

One of the most critical events in the history of finance happened back in 1990. It was the culmination of a transformative two-decade journey that forever changed the way companies are financed.

3 Great High-Yield Stocks Courtesy Of The Most Important Financial Event Of 1990

Oaktree Specialty Lending is dealing with loan performance issues and a rising non-accrual percentage. Despite challenges, the BDC is focusing on a first-lien strategy to strengthen its portfolio and maintain its dividend. OCSL lowered its base management fee in order to provide a $0.15 per-share annual NII uplift.

Oaktree Specialty Lending: A Buying Opportunity With A 13% Yield

Agree Realty

Alerian MLP ETF

Ares Management

Brookfield Renewable Partners

Brookfield Infrastructure Partners L.P.

Brookfield Infrastructure

Blackstone Group

Enbridge

Enterprise Products Partners

Mid-America Apartment Communities

MPLX

Realty Income Corp

Cohen & Steers Infrastructure Fund Inc

Utilities Select Sector SPDR Fund

There are growing risks of a recession hitting due to weakening job numbers, rising unemployment, and weakening consumer spending capacity. We share a portfolio of high-yield stocks that should be able to weather a recession quite well. The yields range from 4.5%-14%.

Big Dividends From A Recession-Resistant Portfolio

Apollo Global Management

Brookfield Asset Management

Brookfield Corp

Carlyle Group

Goldman Sachs

JPMorgan Chase & Co

Blue Owl Capital

The BDC sector is now in a correction. It also faces numerous significant headwinds. We share our outlook on and approach to the sector moving forward.

Very Bad News For BDCs

News for Oaktree Specialty Lending ETF (OCSL)