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Bain Capital Specialty Finance (BCSF)
NYSE:BCSF
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Bain Capital Specialty Finance
(NYSE:BCSF)
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Rating:67Neutral
Price Target:
$15.00
â–²(6.99% Upside)
The score is driven primarily by solid profitability and improved balance-sheet leverage, tempered by a sharp deterioration in free cash flow and declining revenue. Valuation is a key positive (low P/E and very high yield), while technical signals indicate weaker near-term momentum. Earnings call commentary supports dividend resilience, but NAV pressure and investment losses remain notable risks.
Positive Factors
Strong Profitability
Improved profitability indicates efficient operations and enhances the company's ability to reinvest in growth opportunities.
Stable Credit Quality
Stable credit quality minimizes risk and supports consistent income generation, crucial for long-term financial health.
Strong Liquidity Position
Robust liquidity provides flexibility to seize investment opportunities and manage debt, supporting sustainable growth.
Negative Factors
Declining Revenue
A significant revenue decline raises concerns about growth sustainability and could pressure future profitability.
Net Asset Value Decline
A declining NAV may indicate asset devaluation, impacting investor confidence and the company's financial stability.
Negative Free Cash Flow
Negative free cash flow suggests inefficiencies in cash generation, potentially limiting reinvestment and dividend capacity.
Bain Capital Specialty Finance (BCSF) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$909.46M
Dividend Yield13.18%
Average Volume (3M)370.98K
Price to Earnings (P/E)9.7
Beta (1Y)0.54
Revenue Growth-26.08%
EPS Growth-27.65%
CountryUS
EmployeesN/A
SectorFinancial
Sector Strength70
IndustryAsset Management
Share Statistics
EPS (TTM)0.45
Shares Outstanding64,868,510
10 Day Avg. Volume402,065
30 Day Avg. Volume370,981
Financial Highlights & Ratios
PEG Ratio-3.02
Price to Book (P/B)0.99
Price to Sales (P/S)5.31
P/FCF Ratio-41.74
Enterprise Value/Market Cap0.94
Enterprise Value/Revenue4.46
Enterprise Value/Gross Profit7.78
Enterprise Value/Ebitda8.81
Forecast
1Y Price Target
$15.17Price Target Upside8.20% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Bain Capital Specialty Finance Business Overview & Revenue Model
Company DescriptionBain Capital Specialty Finance, Inc. is business development company specializing in direct loans to middle-market companies. The fund seeks to invest in senior investments with a first or second lien on collateral, senior first lien, stretch senior, senior second lien, unitranche, mezzanine debt, junior securities, other junior investments, and secondary purchases of assets or portfolios that primarily consist of middle-market corporate debt. It typically invests in companies with EBITDA between $10 million and $150 million.
How the Company Makes MoneyBCSF generates revenue primarily through interest income on the loans and debt securities it holds in its investment portfolio. The company earns interest from its investments in first and second lien loans, which are typically higher-yielding compared to traditional fixed-income securities. Additionally, BCSF may generate revenue from management fees charged to its portfolio companies and from capital gains realized upon the sale of its equity investments. The company's revenue model is further supported by the growing demand for middle-market financing solutions, as well as strategic partnerships with financial institutions and industry experts that enhance its deal sourcing and investment capabilities.
Bain Capital Specialty Finance Earnings Call Summary
Earnings Call Date:Nov 10, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Mar 03, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted a strong net investment income and stable credit quality, alongside an increase in deal activity and a resilient dividend strategy. However, challenges were noted in the decline of net asset value, lower total investment income, and net realized and unrealized losses. Despite these lowlights, the company's strong dividend yield and stable credit quality provide a positive outlook.Q3-2025 Updates
Positive Updates
Strong Net Investment Income
Q3 net investment income per share was $0.45, representing an annualized yield on book value of 10.3% and exceeding the regular quarterly dividend by 7%.
Stable Credit Quality
Investments on non-accrual represented just 1.5% and 0.7% at amortized cost and fair value, respectively, as of September 30, with non-accruals relatively stable from the prior quarter.
Increased Deal Activity
New deal activity picked up across the middle market, driven by new LBO and M&A activity, with BCSS gross originations at $340 million for the quarter.
Resilient Dividend Strategy
Board declared a fourth quarter dividend equal to $0.42 per share and an additional dividend of $0.03 per share, maintaining a total dividend of $0.45 per share, or a 10.3% annualized rate.
High Dividend Yield
At BCSF's current market price, the dividend yield, inclusive of regular and special dividend for Q4, represents a 13% annualized yield.
Negative Updates
Net Asset Value Decline
Net asset value per share was $17.40, a decline of $0.16 per share from the prior quarter end, primarily due to a markdown on an idiosyncratic loan.
Lower Total Investment Income
Total investment income was $67.2 million for Q3, compared to $71 million for Q2, primarily driven by a decrease in other income from lower activity levels during the quarter.
Net Realized and Unrealized Losses
The company had net realized and unrealized losses of $10.5 million, primarily driven by one portfolio company investment.
Decrease in Portfolio Yield
The weighted average yield on the investment portfolio at amortized cost and fair value decreased to 11.1% and 11.2%, respectively, from 11.4% in the prior quarter.
Company Guidance
In the Bain Capital Specialty Finance earnings call for the third quarter ended September 30, 2025, several key financial metrics and guidance details were provided by the management team. The company reported a Q3 net investment income per share of $0.45, which translated to an annualized yield on book value of 10.3%, surpassing the regular quarterly dividend by 7%. Earnings per share for the quarter were $0.29, reflecting an annualized return on book value of 6.6%. The net asset value (NAV) per share declined by $0.16 from the previous quarter, settling at $17.40, primarily due to a markdown on one loan. The board declared a fourth-quarter dividend of $0.42 per share, along with an additional dividend of $0.03 per share, amounting to a total dividend for the quarter of $0.45 per share or a 10.3% annualized rate on ending book value. New investment fundings totaled $340 million during the quarter, with a weighted average spread of 550 basis points on new originations. The company maintained a disciplined approach to leverage, with a debt-to-equity ratio of 1.33 times, and emphasized its focus on the core middle market to drive attractive spreads on new investments. The management expressed confidence in maintaining the dividend despite potential headwinds from a lower interest rate environment and upcoming debt maturities, leveraging joint ventures and other growth levers to support earnings. The company ended the quarter with a strong liquidity position of $570 million.Bain Capital Specialty Finance Financial Statement Overview
Summary
Strong profitability and improved leverage (debt-to-equity of 0 in 2024; higher net margin and ROE), but revenue fell 25.03% and free cash flow swung to -$27.1M in 2024 from +$219.3M in 2023, raising liquidity and durability concerns.Income Statement
The income statement shows strong profitability with a gross profit margin of 100% due to revenue matching gross profit, indicating no direct costs. The net profit margin improved to 60.32% in 2024 from 41.43% in 2023, reflecting enhanced efficiency. However, the revenue declined by 25.03% from 2023 to 2024, pointing to potential growth challenges. EBIT margin remained stable, supporting continued operational profitability. Overall, while profitability is strong, declining revenue needs attention.Balance Sheet
The balance sheet reflects financial stability with a strong equity position, as indicated by a debt-to-equity ratio of 0 in 2024, showing all debts have been cleared. The equity ratio is healthy at 43.30%, suggesting a solid equity base relative to assets. Return on equity improved to 11.82% in 2024 from 10.85% in 2023, demonstrating enhanced shareholder returns. The elimination of total debt in 2024 improves financial leverage, but historical fluctuations in debt levels suggest potential volatility.Cash Flow
Cash flow statements highlight challenges, with negative free cash flow of -$27.1 million in 2024 compared to positive $219.3 million in 2023, indicating significant cash flow deterioration. The operating cash flow to net income ratio in 2024 is negative, showcasing inefficiency in cash generation from operations. The free cash flow to net income ratio is also negative, reflecting issues in maintaining liquidity. Overall, cash flow management requires improvement to support financial health.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 192.05M | 212.88M | 218.00M | 168.82M | 175.41M | 77.22M |
| Gross Profit | 110.18M | 138.19M | 137.99M | 116.51M | 124.06M | 13.91M |
| EBITDA | 97.34M | 123.89M | 126.73M | 106.32M | 119.94M | 8.51M |
| Net Income | 93.11M | 119.42M | 123.38M | 105.48M | 119.81M | 8.28M |
Balance Sheet | ||||||
| Total Assets | 2.72B | 2.63B | 2.47B | 2.59B | 2.57B | 2.60B |
| Cash, Cash Equivalents and Short-Term Investments | 67.04M | 53.52M | 49.40M | 59.78M | 117.42M | 54.68M |
| Total Debt | 0.00 | 1.39B | 1.26B | 1.39B | 1.41B | 1.46B |
| Total Liabilities | 1.59B | 1.49B | 1.34B | 1.48B | 1.47B | 1.54B |
| Stockholders Equity | 1.13B | 1.14B | 1.14B | 1.12B | 1.10B | 1.07B |
Cash Flow | ||||||
| Free Cash Flow | 87.80M | 112.58M | 125.87M | 114.21M | 54.49M | 75.94M |
| Operating Cash Flow | 87.80M | 112.58M | 125.87M | 114.21M | 54.49M | 75.94M |
| Investing Cash Flow | -105.41M | -139.68M | 93.40M | -431.04M | 211.06M | 13.48M |
| Financing Cash Flow | 42.88M | 14.25M | -231.43M | 238.33M | -138.63M | -76.52M |
Bain Capital Specialty Finance Technical Analysis
Negative
14.02
Price Trends
13.74
Negative
13.90
Negative
14.03
Negative
Market Momentum
0.03
Positive
41.28
Neutral
46.81
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BCSF, the sentiment is Negative. The current price of 14.02 is above the 20-day moving average (MA) of 13.91, above the 50-day MA of 13.74, and below the 200-day MA of 14.03, indicating a bearish trend. The MACD of 0.03 indicates Positive momentum. The RSI at 41.28 is Neutral, neither overbought nor oversold. The STOCH value of 46.81 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BCSF.
Bain Capital Specialty Finance Risk Analysis
Bain Capital Specialty Finance disclosed 2 risk factors in its most recent earnings report. Bain Capital Specialty Finance reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Bain Capital Specialty Finance Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $840.69M | 9.33 | 9.07% | 10.80% | -6.30% | -6.92% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
67 Neutral | $909.46M | 9.75 | 8.18% | 13.18% | -26.08% | -27.65% | |
66 Neutral | $954.19M | 14.18 | 5.43% | 14.17% | 36.15% | -38.59% | |
65 Neutral | $1.05B | 8.05 | 8.75% | 17.34% | -16.58% | 65.24% | |
61 Neutral | $938.60M | 13.19 | 6.80% | 13.64% | 36.91% | -48.79% | |
60 Neutral | $922.95M | 11.00 | 7.03% | 13.63% | -8.23% | -35.72% |
* Financial Sector Average
BCSF
Bain Capital Specialty Finance
13.54
-1.67
-10.98%
NMFC
New Mountain Finance
9.07
-0.62
-6.40%
PFLT
Pennantpark $
9.32
-0.43
-4.41%
SLRC
SLR Investment Corp.
15.10
0.34
2.30%
GSBD
Goldman Sachs BDC
8.96
-1.39
-13.43%
CGBD
Carlyle Secured Lending Inc
12.29
-4.16
-25.29%
Bain Capital Specialty Finance Corporate Events
Business Operations and StrategyDividendsFinancial Disclosures
Bain Capital Specialty Finance Declares Special Cash Dividend
Positive
Dec 22, 2025
On December 22, 2025, Bain Capital Specialty Finance, Inc. announced that its board had declared a special cash dividend of $0.15 per share, to be paid on January 26, 2026, to shareholders of record as of December 31, 2025. The company said the special distribution, driven by over-earnings during the year, is intended to help manage its tax and regulated investment company distribution requirements, while supporting disciplined capital management and maintaining spillover income to underpin the stability of its regular dividend and the gradual growth of net asset value per share over time.
The most recent analyst rating on (BCSF) stock is a Buy with a $16.00 price target. To see the full list of analyst forecasts on Bain Capital Specialty Finance stock, see the BCSF Stock Forecast page.
DividendsFinancial Disclosures
Bain Capital Specialty Finance Announces Q3 Results and Dividend
Positive
Nov 10, 2025
On November 10, 2025, Bain Capital Specialty Finance announced its financial results for the third quarter ending September 30, 2025, and declared a fourth quarter dividend of $0.42 per share, along with an additional $0.03 per share dividend previously announced. The company reported strong earnings driven by high net investment income, which exceeded their regular dividend, and maintained healthy credit performance. The announcement reflects Bain Capital Specialty Finance’s robust operational performance and strategic positioning in the middle-market lending space, potentially benefiting stakeholders with continued high-quality investment opportunities.
The most recent analyst rating on (BCSF) stock is a Buy with a $16.00 price target. To see the full list of analyst forecasts on Bain Capital Specialty Finance stock, see the BCSF Stock Forecast page.
Executive/Board Changes
Bain Capital Appoints New General Counsel Sabrina Rusnak-Carlson
Neutral
Nov 6, 2025
On November 5, 2025, Bain Capital Specialty Finance appointed Sabrina Rusnak-Carlson as General Counsel. Her extensive experience in credit and public equity law, along with her previous roles at First Eagle Alternative Credit and Proskauer Rose LLP, positions her to significantly contribute to the company’s legal and strategic operations.
The most recent analyst rating on (BCSF) stock is a Buy with a $16.00 price target. To see the full list of analyst forecasts on Bain Capital Specialty Finance stock, see the BCSF Stock Forecast page.
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.