Bain Capital Specialty Finance (BCSF)
NYSE:BCSF
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Bain Capital Specialty Finance
(NYSE:BCSF)
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Rating:72Outperform
Price Target:
$15.00
â–²(10.78% Upside)
Action:UpgradedDate:03/04/26
The score is driven primarily by solid fundamentals (profitability, cash generation, and a 2025 top-line rebound) and an attractive valuation/income profile (low P/E and high yield). These positives are moderated by weak technicals (below key moving averages with negative MACD) and management-flagged near-term earnings headwinds from a lower-rate environment and debt maturities.
Positive Factors
Consistent cash generation
BCSF shows durable cash-conversion: operating and free cash flow are positive across reported years and free cash flow aligns with net income. This quality of earnings supports sustainable dividend funding, reduces reliance on external financing, and underpins long-term capital allocation flexibility.
Negative Factors
Rate-driven yield compression risk
Because most income is floating, a sustained decline in reference rates erodes portfolio yields and net investment income. Over months, lower yields can compress margins unless offset by higher spreads on new originations or reduced funding costs, pressuring dividend coverage and cash returns.
Read all positive and negative factors
Positive Factors
Negative Factors
Consistent cash generation
BCSF shows durable cash-conversion: operating and free cash flow are positive across reported years and free cash flow aligns with net income. This quality of earnings supports sustainable dividend funding, reduces reliance on external financing, and underpins long-term capital allocation flexibility.
Read all positive factors
Bain Capital Specialty Finance (BCSF) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$865.99M
Dividend Yield13.18%
Average Volume (3M)507.06K
Price to Earnings (P/E)9.1
Beta (1Y)0.63
Revenue Growth-15.93%
EPS Growth-17.62%
CountryUS
EmployeesN/A
SectorFinancial
Sector Strength70
IndustryAsset Management
Share Statistics
EPS (TTM)0.46
Shares Outstanding64,868,510
10 Day Avg. Volume426,454
30 Day Avg. Volume507,059
Financial Highlights & Ratios
PEG Ratio-0.51
Price to Book (P/B)0.81
Price to Sales (P/S)3.77
P/FCF Ratio7.11
Enterprise Value/Market Cap2.63
Enterprise Value/Revenue9.52
Enterprise Value/Gross Profit12.39
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$13.67Price Target Upside0.94% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)1.61
Revenue Forecast (FY)$254.69M
Bain Capital Specialty Finance Business Overview & Revenue Model
Company Description
Bain 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 seni...
How the Company Makes Money
BCSF makes money primarily from investment income generated by its portfolio of debt investments. Its largest revenue stream is interest income earned on loans it holds (typically floating-rate senior secured loans), which depends on the size of t...
Bain Capital Specialty Finance Earnings Call Summary
Earnings Call Date:Feb 26, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 11, 2026
Earnings Call Sentiment Positive
The call emphasized steady core operating performance, disciplined underwriting, attractive origination spreads, low nonaccruals, strong liquidity, and sustainable dividend coverage — supported by Bain Capital’s platform and selective sector exposures. Offsetting items include modest yield compression from lower reference rates, a small NAV decline driven by special dividends, a minor decline in median EBITDA, and management-flagged earnings headwinds from a lower-rate environment and debt maturities. On balance, the positives around credit quality, dividend support, active liability management, and favorable new origination economics outweigh the headwinds.Positive Updates
Strong Net Investment Income and Dividend Coverage
Q4 net investment income (NII) per share of $0.46 (annualized yield on equity 10.6%); Q4 earnings per share $0.43 (annualized ROE 9.9%). Full-year 2025 NII per share $1.88 (11.1% ROE) and EPS $1.53 (9.0% ROE). Q4 NII covered the regular $0.42 per share dividend by 110% and the Board declared a $0.42 per share Q1 dividend (9.8% annualized on ending book value).
Negative Updates
Yield Compression from Lower Reference Rates
Weighted average yield on the portfolio decreased to 10.8%/10.9% (cost/fair value) from 11.1%/11.2% the prior quarter (absolute decline ~30 bps), driven primarily by lower reference rates which reduce floating-rate interest income.
Read all updates
Q4-2025 Updates
Positive
Negative
Strong Net Investment Income and Dividend Coverage
Q4 net investment income (NII) per share of $0.46 (annualized yield on equity 10.6%); Q4 earnings per share $0.43 (annualized ROE 9.9%). Full-year 2025 NII per share $1.88 (11.1% ROE) and EPS $1.53 (9.0% ROE). Q4 NII covered the regular $0.42 per share dividend by 110% and the Board declared a $0.42 per share Q1 dividend (9.8% annualized on ending book value).
Read all positive updates
Company Guidance
Management guided that it expects to maintain its regular quarterly dividend of $0.42 per share (Q1 dividend declared, record date 03/16/2026) while acknowledging near‑term earnings headwinds from a lower rate environment and maturities of lower‑cost unsecured notes, offset by growth levers such as higher earnings from select joint ventures and ABLs and spillover income of $1.29 per share (over 3x the regular dividend). They cited recent operating metrics to support this view, including Q4 net investment income of $0.46 per share (annualized yield on equity 10.6%) and EPS of $0.43 (annualized ROE 9.9%), full‑year 2025 NII of $1.88 (ROE 11.1%) and EPS $1.53 (ROE 9.0%); a NAV of $17.23 and portfolio fair value of ~$2.5B across 203 companies (median net leverage 4.7x, median interest coverage 2.0x, median LTV ~34%, watchlist ~5%, nonaccruals 1.5% at cost/0.8% at fair value); portfolio yields of ~10.8–10.9% (92% floating), Q4 new first‑lien originations spread ~535 bps (560 bps for 2025) with new‑deal net leverage ~4.6x; strong liquidity of $690M (including $604M undrawn revolver); and disciplined liability management including issuance of $350M 5.95% notes due 2031, a weighted‑avg debt cost of 4.6% and weighted‑avg debt maturity ~3.6 years (debt/equity 1.32x, net leverage 1.24x).Bain Capital Specialty Finance Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
58
Neutral
Cash Flow
74
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 239.19M | 212.88M | 218.00M | 168.82M | 175.41M |
| Gross Profit | 183.89M | 138.19M | 137.99M | 116.51M | 124.06M |
| EBITDA | 183.09M | 123.89M | 126.73M | 106.32M | 119.94M |
| Net Income | 98.76M | 119.42M | 123.38M | 105.48M | 119.81M |
Balance Sheet | |||||
| Total Assets | 2.66B | 2.63B | 2.47B | 2.59B | 2.57B |
| Cash, Cash Equivalents and Short-Term Investments | 135.34M | 53.52M | 49.40M | 59.78M | 117.42M |
| Total Debt | 1.47B | 1.39B | 1.26B | 1.39B | 1.41B |
| Total Liabilities | 1.55B | 1.49B | 1.34B | 1.48B | 1.47B |
| Stockholders Equity | 1.12B | 1.14B | 1.14B | 1.12B | 1.10B |
Cash Flow | |||||
| Free Cash Flow | 126.75M | 112.58M | 125.87M | 114.21M | 54.49M |
| Operating Cash Flow | 126.75M | 112.58M | 125.87M | 114.21M | 54.49M |
| Investing Cash Flow | -97.23M | -139.68M | 93.40M | -431.04M | 211.06M |
| Financing Cash Flow | -71.88M | 14.25M | -231.43M | 238.33M | -138.63M |
Bain Capital Specialty Finance Technical Analysis
Positive
13.54
Price Trends
12.56
Positive
12.88
Positive
13.14
Positive
Market Momentum
0.22
Negative
69.81
Neutral
90.67
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BCSF, the sentiment is Positive. The current price of 13.54 is above the 20-day moving average (MA) of 12.58, above the 50-day MA of 12.56, and above the 200-day MA of 13.14, indicating a bullish trend. The MACD of 0.22 indicates Negative momentum. The RSI at 69.81 is Neutral, neither overbought nor oversold. The STOCH value of 90.67 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BCSF.
Bain Capital Specialty Finance Risk Analysis
Bain Capital Specialty Finance disclosed 8 risk factors in its most recent earnings report. Bain Capital Specialty Finance 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
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 | $865.99M | 9.13 | 8.72% | 13.18% | -15.93% | -17.62% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
66 Neutral | $1.09B | 8.99 | 8.03% | 17.34% | -12.06% | 87.77% | |
61 Neutral | $824.53M | 59.29 | 1.29% | 14.17% | 12.25% | -86.65% | |
60 Neutral | $802.24M | 12.09 | 5.87% | 13.63% | 1.81% | -39.19% | |
58 Neutral | $853.23M | 8.41 | 9.32% | 10.80% | -4.36% | -3.36% | |
54 Neutral | $864.19M | -64.26 | 3.23% | 13.64% | -4.87% | -74.98% |
* Financial Sector Average
BCSF
Bain Capital Specialty Finance
13.74
0.65
4.99%
NMFC
New Mountain Finance
8.54
0.02
0.29%
PFLT
Pennantpark
8.97
0.22
2.54%
SLRC
SLR Investment Corp.
15.80
2.01
14.58%
GSBD
Goldman Sachs BDC
9.83
1.02
11.51%
CGBD
Carlyle Secured Lending Inc
11.86
-0.81
-6.40%
Bain Capital Specialty Finance Corporate Events
DividendsFinancial DisclosuresPrivate Placements and Financing
Bain Capital Specialty Finance Posts Strong 2025 Results
Positive
Feb 27, 2026
On February 26, 2026, Bain Capital Specialty Finance reported strong fourth-quarter and full-year 2025 results, with net investment income of $0.46 per share and net income of $0.43 per share, supporting an annualized return on book value near 10%...
Business Operations and StrategyPrivate Placements and Financing
Bain Capital Specialty Finance Issues New Senior Unsecured Notes
Positive
Jan 29, 2026
On January 29, 2026, Bain Capital Specialty Finance, Inc. entered into a Fourth Supplemental Indenture with U.S. Bank Trust Company, National Association, covering the issuance of $350 million in 5.950% notes due March 1, 2031, which were sold in ...
Private Placements and Financing
Bain Capital Specialty Finance Issues $350 Million 2031 Notes
Positive
Jan 23, 2026
On January 22, 2026, Bain Capital Specialty Finance, Inc. entered into an underwriting agreement with BCSF Advisors, LP and a syndicate of underwriters led by Wells Fargo Securities, J.P. Morgan Securities, and SMBC Nikko Securities America to iss...
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.