Barings BDC (BBDC)
NYSE:BBDC
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Barings BDC
(NYSE:BBDC)
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Rating:69Neutral
Price Target:
$8.50
▲(0.95% Upside)
Action:DowngradedDate:02/20/26
The score is driven primarily by solid financial performance (strong margins and improved cash generation) but tempered by recent revenue contraction and leverage-related sensitivity. Valuation is a plus (low P/E and high yield), while the latest earnings call adds caution due to expected NII pressure and potential dividend reduction despite strong credit metrics. Technicals are broadly neutral to mildly positive.
Positive Factors
Cash Generation / Free Cash Flow
Consistent positive operating and free cash flow since 2022 indicates the company now converts investment income into durable cash, supporting dividend coverage, repurchases and loss absorption. This improves long-term earnings quality and funding flexibility versus earlier negative cash-flow years.
Negative Factors
Rate Sensitivity and Dividend Risk
The business model relies on earning a spread over funding costs; sustained lower base rates compress net investment income and distributable cash. That structural sensitivity raises the risk of reduced regular dividends and constrains capital returns over the coming 2–6 months.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash Generation / Free Cash Flow
Consistent positive operating and free cash flow since 2022 indicates the company now converts investment income into durable cash, supporting dividend coverage, repurchases and loss absorption. This improves long-term earnings quality and funding flexibility versus earlier negative cash-flow years.
Read all positive factors
Barings BDC (BBDC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$881.63M
Dividend Yield13.52%
Average Volume (3M)834.63K
Price to Earnings (P/E)9.5
Beta (1Y)0.58
Revenue Growth-10.40%
EPS Growth-11.42%
CountryUS
Employees2
SectorFinancial
Sector Strength70
IndustryFinancial - Credit Services
Share Statistics
EPS (TTM)0.27
Shares Outstanding104,706,890
10 Day Avg. Volume646,196
30 Day Avg. Volume834,632
Financial Highlights & Ratios
PEG Ratio-1.41
Price to Book (P/B)0.83
Price to Sales (P/S)3.88
P/FCF Ratio6.01
Enterprise Value/Market Cap2.55
Enterprise Value/Revenue9.80
Enterprise Value/Gross Profit12.19
Enterprise Value/Ebitda18.22
Forecast
1Y Price Target
$10.00Price Target Upside18.76% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)0.97
Revenue Forecast (FY)$250.18M
Barings BDC Business Overview & Revenue Model
Company Description
Barings BDC, Inc. (NYSE: BBDC) is a publicly traded, externally managed investment company that has elected to be treated as a business development company under the Investment Company Act of 1940. It seeks to invest primarily in senior secured lo...
How the Company Makes Money
Barings BDC makes money primarily from investment income generated by its portfolio of loans and other investments in middle-market companies. The core revenue stream is interest income earned on debt investments (commonly including floating-rate ...
Barings BDC Earnings Call Summary
Earnings Call Date:Feb 19, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 30, 2026
Earnings Call Sentiment Positive
The call conveyed a cautiously constructive tone: key credit and liquidity metrics are strong (stable NAV, 96% Barings-originated portfolio, 2.4x interest coverage, net leverage 1.15x inside target), legacy holdings have been materially reduced, and capital-return initiatives (dividend and repurchases) continue. Offsetting these positives are meaningful declines in quarterly and annual NII driven by lower base rates and portfolio sales/repayments, a forecast that dividend levels may compress in 2026, and remaining legacy CSA/JV complexity and modest realized losses. Overall, the balance of evidence points to a company with durable credit performance and solid balance-sheet positioning that faces near-term earnings pressure from lower rates and ongoing portfolio rotation.Positive Updates
Stable Net Asset Value
NAV per share was $11.09 at quarter end, essentially unchanged from the prior quarter ($11.10), representing less than a 0.1% quarter-over-quarter decline.
Negative Updates
Decline in Net Investment Income (Quarter and Year)
Quarterly NII declined to $0.27 per share from $0.32 in the prior quarter (a ~15.6% q/q decrease). Full-year NII was $1.12 per share versus $1.24 in 2024 (a ~9.7% year-over-year decline), driven primarily by sales/repayments and lower base rates.
Read all updates
Q4-2025 Updates
Positive
Negative
Stable Net Asset Value
NAV per share was $11.09 at quarter end, essentially unchanged from the prior quarter ($11.10), representing less than a 0.1% quarter-over-quarter decline.
Read all positive updates
Company Guidance
The call’s guidance was measured: management reaffirmed a through‑the‑cycle posture while warning that declining base rates are likely to put downward pressure on net investment income and that the regular dividend (current quarterly $0.26/$1.04 annual) “may decrease” in 2026; however, Q4 NAV was $11.09, Q4 NII was $0.27 (vs. $0.32 prior quarter; $1.12 for 2025 vs. $1.24 in 2024), Q4 NII covered the $0.26 regular dividend and over‑earned it by $0.01, and spillover income of roughly $0.80 per share (≈75% of the regular dividend) provides flexibility. Portfolio and balance‑sheet metrics underpinning the view include a weighted average yield at fair value of 9.6%, weighted average interest coverage of 2.4x, Barings‑originated positions at 96% of the portfolio (up from 76% in 2022), non‑accruals (ex‑Sierra CSA) at 0.2% (0.4% prior), risk‑rating 4+5 at 7%, regulatory net leverage of 1.15x (down from 1.26x; target 0.90–1.25x), ~84% of debt unsecured, and diversified liquidity/near‑term maturities limited. Operational actions and capital‑allocation guidance include continued legacy portfolio rotation (≈$50M Sierra exits in Q4; Sierra generated $24.3M sales/repayments and $21.9M JV return of capital in Q4; Sierra CSA valuation rose ~$7.7M to $60.5M), repayment of $112.5M private‑placement notes in 2025 (and $50M repaid Feb 26), issuance of $300M senior unsecured notes, share repurchases (450k in Q4; >700k in 2025; $0.02/share NAV benefit) and a new $30M 2026 buyback; management said deployment will remain selective, with potential tactical opportunities in BSLs/CLOs and continued focus on core middle‑market, first‑lien, senior‑secured investments.Barings BDC Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
64
Positive
Cash Flow
70
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 248.84M | 209.10M | 289.20M | 219.13M | 119.80M |
| Gross Profit | 184.14M | 123.59M | 289.20M | 219.13M | 86.79M |
| EBITDA | 190.88M | 113.75M | 214.52M | 173.13M | 77.69M |
| Net Income | 101.92M | 110.29M | 128.00M | 4.68M | 77.69M |
Balance Sheet | |||||
| Total Assets | 2.64B | 2.70B | 2.68B | 2.71B | 2.16B |
| Cash, Cash Equivalents and Short-Term Investments | 66.78M | 77.85M | 70.53M | 139.41M | 84.25M |
| Total Debt | 1.43B | 1.45B | 1.44B | 1.45B | 1.37B |
| Total Liabilities | 1.48B | 1.51B | 1.48B | 1.52B | 1.42B |
| Stockholders Equity | 1.16B | 1.19B | 1.20B | 1.19B | 741.93M |
Cash Flow | |||||
| Free Cash Flow | 160.54M | 117.85M | 76.94M | 86.27M | -396.55M |
| Operating Cash Flow | 160.54M | 117.85M | 76.94M | 86.27M | -396.55M |
| Investing Cash Flow | 36.83M | 4.31M | -21.14M | -120.88M | -451.63B |
| Financing Cash Flow | -185.10M | -101.35M | -145.83M | -31.11M | 388.32M |
Barings BDC Technical Analysis
Positive
8.42
Price Trends
8.48
Negative
8.56
Negative
8.54
Negative
Market Momentum
-0.05
Negative
54.47
Neutral
71.92
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BBDC, the sentiment is Positive. The current price of 8.42 is above the 20-day moving average (MA) of 8.20, below the 50-day MA of 8.48, and below the 200-day MA of 8.54, indicating a neutral trend. The MACD of -0.05 indicates Negative momentum. The RSI at 54.47 is Neutral, neither overbought nor oversold. The STOCH value of 71.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BBDC.
Barings BDC Risk Analysis
Barings BDC disclosed 83 risk factors in its most recent earnings report. Barings BDC reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Barings BDC Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $1.64B | 6.71 | 12.48% | ― | 9.70% | 26.63% | |
69 Neutral | $881.63M | 9.47 | 8.69% | 13.52% | -10.40% | -11.42% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
60 Neutral | $708.10M | -193.38 | 10.79% | ― | 2.31% | -27.81% | |
58 Neutral | $1.02B | 50.03 | 2.21% | 13.37% | 22.17% | -46.78% | |
49 Neutral | $622.36M | -3.80 | -10.77% | ― | 23.12% | 19.37% | |
49 Neutral | $825.79M | 7.20 | 20.59% | ― | 25.29% | 26.70% |
* Financial Sector Average
BBDC
Barings BDC
8.42
1.47
21.08%
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Barings BDC Corporate Events
Business Operations and StrategyDividendsFinancial Disclosures
Barings BDC Announces Strong Q4 and 2025 Results
Positive
Feb 19, 2026
On February 19, 2026, Barings BDC reported its fourth-quarter and full-year 2025 results, posting Q4 net investment income of $28.0 million, or $0.27 per share, and a full-year total of $117.8 million, or $1.12 per share, both exceeding regular di...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.