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Golub Capital Bdc (GBDC)
NASDAQ:GBDC
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Golub Capital Bdc
(NASDAQ:GBDC)
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Rating:62Neutral
Price Target:
$14.50
â–²(5.15% Upside)
The score is mainly held back by fundamental quality concerns—especially cash-flow volatility and recent negative operating cash flow—along with leverage. These are partially offset by attractive valuation (low P/E and high yield) and a generally positive earnings-call read on credit quality and funding costs, though technicals remain weak with the stock trading below key moving averages.
Positive Factors
Strong Financial Performance
The company's strong financial performance, with high adjusted NII and return on equity, indicates effective management and robust profitability, supporting long-term growth.
Portfolio Growth and Credit Quality
The growth in portfolio and improved credit quality reflect the company's ability to expand its investment base while maintaining low-risk exposure, ensuring sustainable earnings.
Successful Debt Management
Effective debt management through securitization reduces borrowing costs, enhancing financial flexibility and supporting long-term strategic initiatives.
Negative Factors
Spread Compression
Spread compression affects yield on investments, potentially reducing future income and impacting the company's ability to maintain high returns.
NAV Per Share Decline
The decline in NAV per share indicates potential challenges in asset value growth, which could affect investor confidence and long-term valuation.
Cash Flow Management Challenges
Challenges in cash flow management may hinder the company's ability to reinvest and cover obligations, impacting financial stability and growth potential.
Golub Capital Bdc (GBDC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.63B
Dividend Yield11.7%
Average Volume (3M)1.77M
Price to Earnings (P/E)9.7
Beta (1Y)0.52
Revenue Growth24.12%
EPS Growth1.09%
CountryUS
Employees875
SectorFinancial
Sector Strength70
IndustryAsset Management
Share Statistics
EPS (TTM)0.39
Shares Outstanding263,467,530
10 Day Avg. Volume1,716,834
30 Day Avg. Volume1,766,989
Financial Highlights & Ratios
PEG Ratio2.08
Price to Book (P/B)0.91
Price to Sales (P/S)4.54
P/FCF Ratio-32.06
Enterprise Value/Market Cap2.32
Enterprise Value/Revenue12.06
Enterprise Value/Gross Profit13.42
Enterprise Value/Ebitda18.80
Forecast
1Y Price Target
$15.00Price Target Upside8.77% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
EPS Forecast (FY)1.45
Revenue Forecast (FY)$804.68M
Golub Capital Bdc Business Overview & Revenue Model
Company DescriptionGolub Capital BDC, Inc. (GBDC) is a business development company and operates as an externally managed closed-end non-diversified management investment company. It invests in debt and minority equity investments in middle-market companies that are, in most cases, sponsored by private equity investors. It typically invests in diversified consumer services, automobiles, healthcare technology, insurance, health care equipment and supplies, hotels, restaurants and leisure, healthcare providers and services, IT services and specialty retails. It seeks to invest in the United States. It primarily invests in first lien traditional senior debt, first lien one stop, junior debt and equity, senior secured, one stop, unitranche, second lien, subordinated and mezzanine loans of middle-market companies, and warrants.
How the Company Makes MoneyGolub Capital BDC, Inc. makes money primarily through interest income generated from its portfolio of debt investments. The company's revenue model is centered around providing loans to middle-market businesses, which typically have revenues between $10 million and $100 million. GBDC earns interest income from these loans, which are often structured with favorable terms to ensure consistent cash flow. Additionally, the firm may generate fee income from originating and managing these loans. Significant partnerships with private equity firms and other financial institutions can contribute to its deal flow and investment opportunities, enhancing its ability to generate returns for its shareholders. The company's focus on senior secured loans helps mitigate risk, further contributing to its earnings stability.
Golub Capital Bdc Earnings Call Summary
Earnings Call Date:Nov 18, 2025
(Q4-2025)
| % Change Since: |
Next Earnings Date:Feb 04, 2026
Earnings Call Sentiment Neutral
The earnings call reflects a strong fiscal year 2025 performance with solid earnings and low levels of nonaccrual investments. However, the company is facing market challenges, including spread compression and elevated defaults in the leveraged loan market. Despite these headwinds, GBDC's robust origination activity and successful debt management position it well for future resilience.Q4-2025 Updates
Positive Updates
Strong Fiscal Year 2025 Performance
GBDC had a solid quarter and a strong end to fiscal year 2025, with adjusted NII per share of $0.39 and an adjusted NII ROE of 10.4%. The company paid $1.65 per share of cumulative distributions, representing 10.9% of end-of-year NAV per share, which is $0.34 above GBDC's NAV per share at its IPO in 2010.
Low Nonaccrual Levels
Investments on nonaccrual status decreased to 0.3% of the total investment portfolio at fair value, well below the BDC peer industry average. About 90% of GBDC's investment portfolio remains in the highest performing internal rating categories.
Successful Debt Management
GBDC reduced its effective borrowing costs during the quarter to 5.6% annualized, considered an industry-leading level, by repricing its syndicated corporate revolver and calling the final legacy debt securitization.
Robust Origination Activity
GBDC closed on 3.8% of deals reviewed with a weighted average LTV of 42%, maintaining a strong position in the core middle market with a median EBITDA of $61 million for originations.
Negative Updates
Market Headwinds and Spread Compression
The direct lending market is facing headwinds, including narrower spreads across various fixed income markets and a decrease in base rates, which are expected to continue declining.
Credit Cycle and Elevated Defaults
The leveraged loan market is experiencing unusual levels of defaults and credit stress, which is expected to persist and impact different BDCs in varying ways.
Decline in Investment Income Yield
GBDC's investment income yield fell approximately 20 basis points sequentially to 10.4%, driven by a modest decline in weighted average base rates and compression of weighted average portfolio spreads.
Company Guidance
During the earnings call for the fiscal quarter and year ended September 30, 2025, GBDC provided guidance on its financial performance and market outlook. Adjusted net investment income (NII) per share was reported at $0.39, translating to an adjusted NII return on equity (ROE) of 10.4%. The adjusted net income per share stood at $0.36, reflecting an adjusted ROE of 9.6%. Over the fiscal year, GBDC distributed $1.65 per share, representing 10.9% of the end-of-year net asset value (NAV) per share, which was $14.97. The company's portfolio demonstrated solid credit performance, with 90% categorized in the highest-performing internal rating categories, and investments on nonaccrual status accounted for merely 0.3% of the total portfolio at fair value. Despite these positive metrics, GBDC acknowledged facing industry-wide headwinds, such as narrowing spreads and a challenging credit cycle with heightened defaults. The firm plans to maintain a prudent approach to dividends and will revisit its dividend policy early in 2026, aiming to align with its goals of stable NAV per share, minimized excise taxes, and sustainable dividend yield.Golub Capital Bdc Financial Statement Overview
Summary
Income statement strength (revenue up ~19% in 2025 and high reported margins) is offset by meaningful leverage (debt-to-equity ~1.23) and, most importantly, highly volatile cash generation with negative operating cash flow in 2025 after a strong 2024.Income Statement
Revenue expanded strongly in 2025 (annual revenue up ~19% to ~$803M), extending a multi-year growth trend. Profitability looks very high on the surface (2025 net margin ~49% and EBIT margin ~82%), but margins have been volatile across years (including an unusually high net margin in 2021 and a very low EBITDA margin reported in 2025 versus prior years), which reduces confidence in consistency. Net income has remained solid, supporting a strong—but not top-tier—income statement score given the variability.78
Positive
Balance Sheet
The balance sheet is sizable (2025 assets ~$9.0B) with equity near ~$4.0B, but leverage is meaningful for the profile: debt-to-equity sits around ~1.23 in 2025 (and ~1.15 in 2024). Returns on equity are decent (~10% in 2025) and generally supportive of the model, yet the debt load remains a key risk factor and limits flexibility versus lower-levered peers.64
Positive
Cash Flow
Cash generation is the weakest area: operating cash flow turned negative in 2025 (about -$114M) after being strongly positive in 2024 (~$344M), and the growth rate of free cash flow swung sharply negative. History shows additional negative years (2021–2022), pointing to material volatility in cash conversion and a higher dependence on market/portfolio dynamics. This uneven cash flow profile meaningfully drags the overall quality of the statements despite solid reported earnings.38
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 700.63M | 802.73M | 475.73M | 427.66M | 254.66M | 415.20M |
| Gross Profit | 629.31M | 629.31M | 272.57M | 284.43M | 165.28M | 349.46M |
| EBITDA | 449.15M | 1.09M | 274.36M | 262.21M | 154.67M | 340.82M |
| Net Income | 376.65M | 396.80M | 273.79M | 258.63M | 153.44M | 340.28M |
Balance Sheet | ||||||
| Total Assets | 8.98B | 8.98B | 8.71B | 5.73B | 5.68B | 5.16B |
| Cash, Cash Equivalents and Short-Term Investments | 100.76M | 100.76M | 131.16M | 69.83M | 124.14M | 181.09M |
| Total Debt | 4.90B | 4.90B | 4.60B | 3.12B | 3.08B | 2.55B |
| Total Liabilities | 5.00B | 5.00B | 4.69B | 3.19B | 3.14B | 2.58B |
| Stockholders Equity | 3.98B | 3.98B | 4.01B | 2.55B | 2.54B | 2.58B |
Cash Flow | ||||||
| Free Cash Flow | -113.59M | -113.59M | 343.91M | 195.37M | -416.46M | -306.05M |
| Operating Cash Flow | -113.59M | -113.59M | 343.91M | 195.37M | -416.46M | -306.05M |
| Investing Cash Flow | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Financing Cash Flow | -131.59M | -131.59M | -124.24M | -235.55M | 353.13M | 366.85M |
Golub Capital Bdc Technical Analysis
Positive
13.79
Price Trends
13.60
Positive
13.62
Positive
13.69
Positive
Market Momentum
0.05
Negative
60.08
Neutral
70.81
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GBDC, the sentiment is Positive. The current price of 13.79 is above the 20-day moving average (MA) of 13.61, above the 50-day MA of 13.60, and above the 200-day MA of 13.69, indicating a bullish trend. The MACD of 0.05 indicates Negative momentum. The RSI at 60.08 is Neutral, neither overbought nor oversold. The STOCH value of 70.81 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GBDC.
Golub Capital Bdc Risk Analysis
Golub Capital Bdc disclosed 107 risk factors in its most recent earnings report. Golub Capital 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
Golub Capital Bdc Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $3.42B | 10.96 | 15.21% | 10.00% | -15.32% | -12.29% | |
77 Outperform | $5.58B | 10.32 | 19.07% | 7.17% | 11.60% | 9.38% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
65 Neutral | $1.06B | 8.13 | 8.75% | 17.34% | -16.58% | 65.24% | |
64 Neutral | $2.08B | 10.80 | 11.91% | 9.64% | -6.44% | -1.18% | |
62 Neutral | $3.63B | 9.74 | 9.42% | 11.70% | 24.12% | 1.09% | |
60 Neutral | $4.09B | 15.05 | 4.24% | 18.52% | -13.67% | -48.49% |
* Financial Sector Average
GBDC
Golub Capital Bdc
13.95
0.16
1.16%
HTGC
Hercules Capital
18.97
0.27
1.44%
MAIN
Main Street Capital
64.20
7.90
14.03%
TSLX
Sixth Street Specialty Lending
22.40
2.60
13.13%
FSK
FS KKR Capital
14.66
-4.32
-22.76%
GSBD
Goldman Sachs BDC
9.43
-1.36
-12.60%
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.