Runway Growth Finance Corp (RWAY) AI Stock Analysis

• Market Cap: $287.99M
• Dividend Yield: 15.96%
• Average Volume (3M): 393.11K
• Price to Earnings (P/E): 11.5
• Beta (1Y): 0.63
• Revenue Growth: 6.38%
• EPS Growth: 41.48%
• Country: US
• Employees: N/A
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Credit Services
• EPS (TTM): 0.43
• Shares Outstanding: 36,134,037
• 10 Day Avg. Volume: 478,550
• 30 Day Avg. Volume: 393,114
• PEG Ratio: 0.08
• Price to Book (P/B): 0.83
• Price to Sales (P/S): 3.43
• P/FCF Ratio: 8.43
• Enterprise Value/Market Cap: 2.51
• Enterprise Value/Revenue: 6.80
• Enterprise Value/Gross Profit: 10.61
• Enterprise Value/Ebitda: 13.18
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 1.5
• Revenue Forecast (FY): $146.13M

• Rating: 61 Neutral
• Price Target: $9.50 ▲(12.43% Upside)
• Action: Reiterated Date: 02/04/26
• Date: Action: Reiterated 02/04/26

The score is driven mainly by solid underlying profitability and an attractive valuation (low P/E and high dividend yield). These positives are balanced by weak technical momentum (trading below key moving averages with negative MACD) and mixed fundamentals/call takeaways, including softening revenue trends, portfolio/NAV declines, and credit-related risks despite the potentially accretive SWK merger and refinancing actions.

Positive Factors

High Profitability

Sustained high gross and net margins indicate durable earnings power for a credit provider. Strong margins support dividend distributions, internal capital to fund new originations, and cushion against credit mark-to-market swings, improving long-term payout and reinvestment capacity.

Positive Cash Generation

Consistent positive operating and free cash flow that matches reported net income provides structural support for dividends and debt service. Reliable cash conversion enhances balance-sheet flexibility to fund originations and manage maturities across credit cycles.

Strategic Scale via SWK Merger

The NAV-for-NAV SWK transaction materially increases portfolio scale and healthcare exposure, delivering diversification and potential synergies. Increased scale can lower per-unit costs, broaden origination channels, and be accretive to net investment income over multiple quarters.

Negative Factors

Weakening Revenue Trend

A declining revenue trajectory reduces the firm's ability to grow net investment income organically. Persistently weak origination or mark-to-market pressure can erode future earnings, making dividend coverage and portfolio reinvestment more dependent on non-recurring items or M&A.

Elevated Leverage

Moderate-to-elevated leverage increases vulnerability to rate moves and refinancing cycles. Higher debt levels constrain flexibility for opportunistic lending or loss absorption and raise the importance of successful liability management to avoid pressure on distributions during stress periods.

Portfolio Credit Stress & NAV Declines

Repeated fair-value declines, realized losses and a nonaccrual position signal persistent credit risk in the portfolio. These trends can pressure NAV and future earnings, force higher provisioning, and limit free cash flow available for dividends or new investments over the medium term.

Runway Growth Finance Corp Business Overview & Revenue Model

Company Description

Runway Growth Finance Corp. is a business development company specializing investments in senior-secured loans to late stage and growth companies. It prefers to make investments in companies engaged in the technology, life sciences, healthcare and information services, business services and select consumer services and products sectors. It prefers to investments in companies engaged in electronic equipment and instruments, systems software, hardware, storage and peripherals and specialized consumer services, application software, healthcare technology, internet software and services, data processing and outsourced services, internet retail, human resources and employment services, biotechnology, healthcare equipment and education services. It invests in senior secured loans between $10 million and $75 million.

How the Company Makes Money

Runway Growth Finance Corp generates revenue primarily through interest income from loans provided to its portfolio companies. The company charges interest on its debt instruments, which typically includes structured loans that have varying terms and conditions based on the specific needs of the borrowers. In addition to interest income, RWAY may also earn fees related to loan origination, servicing, and prepayment penalties. The company may engage in equity investments, which can provide additional revenue through capital appreciation and dividends. Key partnerships with venture capital firms and private equity groups allow RWAY to access a broader range of potential borrowers, enhancing its market reach and facilitating deal flow, thereby contributing to its overall earnings.

Runway Growth Finance Corp Financial Statement Overview

Summary

Profitability is strong (high margins and meaningful operating profit) with acceptable ROE, and current cash generation is positive with free cash flow matching net income. Offsetting this are weakening TTM revenue, historically volatile cash flows, and moderate leverage with some missing/invalid leverage and coverage datapoints that reduce confidence in the most current risk profile.

Income Statement

Profitability is a clear strength: TTM (Trailing-Twelve-Months) shows solid margins (about 51% gross profit margin and ~37% net profit margin) and meaningful operating profit. However, growth is the main concern—TTM revenue declined ~13.8% versus the prior period, and the most recent annual period (2024) was essentially flat, following a stronger 2023. Overall, earnings power looks good, but the revenue trajectory has weakened.

Balance Sheet

Leverage is moderate for the profile: 2024 debt was roughly in line with equity (debt-to-equity ~1.07), and total assets remain sizable. Returns on equity are decent (TTM ~12% and 2024 ~14%), supporting balance-sheet productivity. That said, debt levels have been elevated across recent years and increased materially versus 2021, which raises refinancing/credit-cycle sensitivity; additionally, the TTM debt-to-equity is shown as 0.0 in the data (likely missing/invalid), limiting visibility on the most current leverage ratio.

Cash Flow

Cash generation is currently positive, with TTM operating cash flow and free cash flow around $42M and free cash flow matching net income (suggesting earnings are backed by cash in the latest period). But cash flow volatility is a notable weakness: 2020–2021 had negative operating/free cash flow, 2023 spiked higher, and both TTM and 2024 show declines in free cash flow growth (TTM down ~14.9%). Also, TTM operating cash flow coverage is listed as 0.0 (likely missing/invalid), reducing clarity on near-term debt-cash coverage.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	106.41M	124.22M	94.52M	55.14M	54.00M	52.44M
Gross Profit	68.20M	85.89M	55.88M	41.38M	49.81M	51.38M
EBITDA	54.90M	73.61M	44.34M	32.25M	45.62M	46.98M
Net Income	54.90M	73.61M	44.34M	32.25M	45.62M	46.98M
Balance Sheet
Total Assets	963.35M	1.09B	1.08B	1.14B	738.35M	639.89M
Cash, Cash Equivalents and Short-Term Investments	7.92M	5.75M	2.97M	5.76M	4.70M	14.89M
Total Debt	443.51M	552.33M	510.08M	548.96M	79.49M	97.42M
Total Liabilities	473.82M	576.49M	532.08M	565.71M	132.15M	173.65M
Stockholders Equity	489.53M	514.87M	547.07M	576.05M	606.20M	466.24M
Cash Flow
Free Cash Flow	42.34M	50.49M	112.44M	48.98M	-61.25M	-106.09M
Operating Cash Flow	42.34M	50.49M	112.44M	48.98M	-61.25M	-106.09M
Investing Cash Flow	206.25M	-22.93M	0.00	-453.82M	-120.84M	168.61M
Financing Cash Flow	-175.27M	-66.81M	-115.23M	360.91M	51.06M	75.18M

Runway Growth Finance Corp Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 8.45
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RWAY, the sentiment is Negative. The current price of 8.45 is above the 20-day moving average (MA) of 8.41, below the 50-day MA of 8.86, and below the 200-day MA of 9.72, indicating a bearish trend. The MACD of -0.29 indicates Positive momentum. The RSI at 36.71 is Neutral, neither overbought nor oversold. The STOCH value of 42.35 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RWAY.

Runway Growth Finance Corp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MFIN	74 Outperform	$236.52M	5.44	10.79%	4.44%	15.52%	2.05%
YRD	73 Outperform	$317.98M	2.91	12.53%	10.37%	10.48%	-30.67%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
OPRT	64 Neutral	$242.97M	18.74	6.79%	―	-5.29%	―
RM	62 Neutral	$304.84M	8.66	11.43%	2.99%	9.63%	77.14%
RWAY	61 Neutral	$287.99M	11.47	11.02%	15.96%	6.38%	41.48%
LPRO	49 Neutral	$158.37M	-8.24	-102.53%	―	-82.33%	-3365.80%

Runway Growth Finance Corp Corporate Events

Runway Growth Finance Issues New Notes for Refinancing

On February 3, 2025, Runway Growth Finance Corp. entered into a third supplemental indenture with U.S. Bank Trust Company to support the issuance and sale of $103.25 million of 7.25% unsecured notes due 2031, which rank pari passu with its other unsecured debt and are subject to covenants tied to leverage limits and distribution restrictions under the Investment Company Act of 1940. The transaction, which closed on February 3, 2026, is part of a balance sheet refinancing in which the company plans to use the proceeds to repay outstanding indebtedness, including redeeming all $51.75 million of its 8.00% notes and $40.25 million of its 7.50% notes, with the partial and full redemptions of these higher-coupon notes expected to occur on March 5, 2026 at $25 per note plus accrued interest, potentially lowering the firm’s funding costs and optimizing its liability profile.

The most recent analyst rating on (RWAY) stock is a Buy with a $10.00 price target. To see the full list of analyst forecasts on Runway Growth Finance Corp stock, see the RWAY Stock Forecast page.

Runway Growth Finance Announces New 2031 Notes Offering

On January 27, 2026, Runway Growth Finance Corp. entered into an underwriting agreement with Runway Growth Capital LLC and Oppenheimer & Co. Inc., as representative of a group of underwriters, to issue and sell $100 million in aggregate principal amount of 7.25% notes due 2031, with closing expected on February 3, 2026, subject to customary conditions. The company also granted underwriters a 30-day option to purchase up to an additional $15 million of the notes to cover any overallotments, signaling an effort to raise additional long-term capital and potentially broaden its investor base through a registered offering under its existing shelf registration statement.

The most recent analyst rating on (RWAY) stock is a Buy with a $10.50 price target. To see the full list of analyst forecasts on Runway Growth Finance Corp stock, see the RWAY Stock Forecast page.

Runway Growth Finance Receives FTC Merger Approval

On December 2, 2025, Runway Growth Finance Corp received notification from the U.S. Federal Trade Commission regarding the early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act for its proposed merger with SWK Holdings Corporation. This development satisfies a key condition for the merger’s completion, although other customary closing conditions, including SWK stockholder approval, remain pending. The merger is expected to create synergies and cost savings, potentially impacting the operational efficiency and market positioning of the combined entity.

The most recent analyst rating on (RWAY) stock is a Hold with a $9.00 price target. To see the full list of analyst forecasts on Runway Growth Finance Corp stock, see the RWAY Stock Forecast page.

Runway Growth Finance Declares Fourth Quarter Dividend

On November 5, 2025, Runway Growth Finance Corp.’s board of directors declared a regular fourth quarter dividend of $0.33 per share, payable to stockholders of record on November 17, 2025, with a payment date set for December 3, 2025. This announcement reflects the company’s ongoing commitment to distribute substantially all of its available earnings on a quarterly basis, subject to various conditions, and offers stockholders the option to reinvest dividends through an amended ‘opt out’ dividend reinvestment plan.

The most recent analyst rating on (RWAY) stock is a Hold with a $10.00 price target. To see the full list of analyst forecasts on Runway Growth Finance Corp stock, see the RWAY Stock Forecast page.