Sixth Street Specialty Lending, Inc. (TSLX)
NYSE:TSLX
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Sixth Street Specialty Lending
(NYSE:TSLX)
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Rating:59Neutral
Price Target:
$18.00
â–¼(-7.31% Downside)
Action:Reiterated
Date:05/15/26
The score is held back primarily by weak technicals (price below key moving averages with negative MACD). Fundamentals are solid but not accelerating, with slowing revenue/earnings and some balance-sheet/cash-flow consistency flags. Valuation is supported by a very high dividend yield, while the earnings call was mixed: strong liquidity and dividend coverage offset by NAV decline from market marks and a dividend reduction.
Positive Factors
Liquidity & Funding
Ample revolving capacity and a materially extended credit facility provide a durable funding runway and meaningful optionality to support originations, pay maturing debt or buy opportunities. This reduces near-term refinancing risk and enables opportunistic deployment across credit cycles.
Negative Factors
NAV Sensitivity to Credit Spreads
Significant NAV moves driven by mark‑to‑market spread and multiple shifts show the portfolio is exposed to market pricing volatility. Such sensitivity produces noncash losses that can compress reported capital and constrain dividend policy if wide spreads persist, a structural risk in stressed credit cycles.
Read all positive and negative factors
Positive Factors
Negative Factors
Liquidity & Funding
Ample revolving capacity and a materially extended credit facility provide a durable funding runway and meaningful optionality to support originations, pay maturing debt or buy opportunities. This reduces near-term refinancing risk and enables opportunistic deployment across credit cycles.
Read all positive factors
Sixth Street Specialty Lending (TSLX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.63B
Dividend Yield9.64%
Average Volume (3M)737.86K
Price to Earnings (P/E)―
Beta (1Y)0.59
Revenue Growth-29.32%
EPS Growth-39.45%
CountryUS
EmployeesN/A
SectorFinancial
Sector Strength70
IndustryAsset Management
Share Statistics
EPS (TTM)1.15
Shares Outstanding95,019,600
10 Day Avg. Volume807,823
30 Day Avg. Volume737,861
Financial Highlights & Ratios
PEG Ratio-1.11
Price to Book (P/B)1.28
Price to Sales (P/S)5.71
P/FCF Ratio11.41
Enterprise Value/Market Cap-15.79
Enterprise Value/Revenue-76.13
Enterprise Value/Gross Profit-104.31
Enterprise Value/Ebitda-132.62
Forecast
1Y Price Target
$19.94Price Target Upside2.66% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
EPS Forecast (FY)1.76
Revenue Forecast (FY)$408.75M
Sixth Street Specialty Lending Business Overview & Revenue Model
Company Description
Sixth Street Specialty Lending, Inc. (NYSE: TSLX) is a business development company. The fund provides senior secured loans (first-lien, second-lien, and unitranche), unsecured loans, mezzanine debt, and investments in corporate bonds and equity s...
How the Company Makes Money
TSLX makes money primarily from investment income generated by its portfolio of debt investments. The largest revenue stream is interest income earned on loans (typically senior secured, including first-lien loans) made to portfolio companies; thi...
Sixth Street Specialty Lending Earnings Call Summary
Earnings Call Date:May 05, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 04, 2026
Earnings Call Sentiment Neutral
The call balanced clear near-term headwinds — notably a NAV decline driven by market-wide spread widening, a reduction in activity-based fees, lower investment income, and a modest base dividend reduction — with several constructive elements: solid net investment income, ample liquidity and an extended credit facility, embedded activity-fee upside ($1.57 per share), disciplined originations with attractive realizations (strong asset-level IRRs), stable portfolio credit metrics (low nonaccrual % and a 1.19 weighted rating), and long-term NAV outperformance since IPO. Management emphasized the marks are largely unrealized and tied to market inputs and highlighted opportunities from a more lender-friendly documentation and spread environment. Given the mix of meaningful but largely noncash valuation pressures counterbalanced by strong liquidity, portfolio quality, upside optionality and disciplined positioning, the overall tone is cautious but constructive.Positive Updates
Net Investment Income and ROE
Generated net investment income of $0.42 per share in Q1, delivering an annualized return on equity of 9.9%.
Negative Updates
NAV Decline Driven by Market Marks
Net asset value per share declined approximately 4.3% to $16.24. $0.58 per share (nearly 80% of the decline) was attributable to unrealized fair value marks driven by wider market spreads and lower market multiples ($0.40 from debt portfolio spread widening; $0.18 from limited equity valuation compression).
Read all updates
Q1-2026 Updates
Positive
Negative
Net Investment Income and ROE
Generated net investment income of $0.42 per share in Q1, delivering an annualized return on equity of 9.9%.
Read all positive updates
Company Guidance
Management set a new base quarterly dividend of $0.42 (annualized yield 10.3% on Q1 NAV of $16.24) and tied forward ROE guidance to portfolio turnover: assuming turnover below 20% for the year they expect ROE of 10.0%–10.5%, with ROE >10.5% if repayment activity is higher (original guidance assumed 30% turnover). They reported Q1 NII of $0.42/share (annualized ROE 9.9%), net loss per share of $0.27, NAV of $16.24 (down ~4.3% from $16.97), and noted $0.58/share (~80% of the NAV decline) from fair-value marks (≈$0.40/sh from debt spread widening and $0.18/sh from lower equity multiples) with an estimated ~$0.12/share of spread tightening post-quarter. Management highlighted embedded upside of ~$1.57/share of potential activity‑based fees (Q1 activity fees $0.05/sh vs a 3‑yr avg of $0.09/sh), undistributed income ≈$1.15/sh, total investments $3.3B, principal debt $1.8B, net assets $1.5B, strong liquidity (≈$1.1B revolver capacity, $249M unfunded commitments eligible; post-amendment liquidity $649M = 2.6x unfunded commitments), and portfolio metrics (weighted‑avg yield on debt 11.2% from 11.3%, attachment/detachment leverage 0.4x/5.2x, interest coverage 2.3x, weighted revenue/EBITDA $425M/$127M, LTM revenue and EBITDA growth 9%) that position them to invest opportunistically.Sixth Street Specialty Lending Financial Statement Overview
Summary
Income Statement
70
Positive
Balance Sheet
58
Neutral
Cash Flow
62
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 338.16M | 360.21M | 359.74M | 369.80M | 187.16M | 266.27M |
| Gross Profit | 246.79M | 262.39M | 252.97M | 273.41M | 136.49M | 225.86M |
| EBITDA | 194.11M | 230.75M | 193.12M | 223.83M | 111.24M | 214.07M |
| Net Income | 107.54M | 170.52M | 186.57M | 222.02M | 108.05M | 211.78M |
Balance Sheet | ||||||
| Total Assets | 3.39T | 3.42B | 3.58B | 3.34B | 2.84B | 2.55B |
| Cash, Cash Equivalents and Short-Term Investments | 29.18B | 2.94M | 4.97M | 1.22M | 10.21M | 1.57M |
| Total Debt | 1.80B | 1.74B | 1.90B | 1.78B | 1.44B | 1.19B |
| Total Liabilities | 1.85T | 1.81B | 1.97B | 1.85B | 1.50B | 1.28B |
| Stockholders Equity | 1.54T | 1.61B | 1.61B | 1.50B | 1.34B | 1.28B |
Cash Flow | ||||||
| Free Cash Flow | 144.10M | 180.28M | 187.25M | 191.97M | 71.83M | 112.62M |
| Operating Cash Flow | 144.10M | 180.28M | 187.25M | 191.97M | 71.83M | 112.62M |
| Investing Cash Flow | 84.21M | 221.29M | -232.74M | -428.76M | -296.37M | -110.17M |
| Financing Cash Flow | -246.40M | -409.24M | 47.62M | 236.34M | 234.21M | 241.00K |
Sixth Street Specialty Lending Technical Analysis
Negative
19.42
Price Trends
18.26
Negative
19.03
Negative
20.25
Negative
Market Momentum
-0.35
Positive
36.27
Neutral
14.77
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSLX, the sentiment is Negative. The current price of 19.42 is above the 20-day moving average (MA) of 18.22, above the 50-day MA of 18.26, and below the 200-day MA of 20.25, indicating a bearish trend. The MACD of -0.35 indicates Positive momentum. The RSI at 36.27 is Neutral, neither overbought nor oversold. The STOCH value of 14.77 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSLX.
Sixth Street Specialty Lending Risk Analysis
Sixth Street Specialty Lending disclosed 2 risk factors in its most recent earnings report. Sixth Street Specialty Lending 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
Sixth Street Specialty Lending Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $1.48B | 6.76 | 14.73% | 13.53% | 4.03% | -16.92% | |
70 Outperform | $2.55B | 19.99 | 200.83% | 0.08% | 20.72% | -2.79% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
65 Neutral | $1.41B | 11.07 | 11.68% | 11.90% | 55.92% | 35.62% | |
59 Neutral | $1.63B | -16.72 | 0.03% | 9.64% | -29.32% | -39.45% | |
59 Neutral | $749.95M | -3.83 | -4.83% | 14.17% | -24.31% | -157.16% | |
52 Neutral | $997.36M | -18.33 | 5.14% | 17.34% | 14.92% | 48.21% |
* Financial Sector Average
TSLX
Sixth Street Specialty Lending
17.16
-3.44
-16.71%
CSWC
Capital Southwest
22.77
4.74
26.30%
NMFC
New Mountain Finance
7.94
-1.28
-13.88%
GSBD
Goldman Sachs BDC
8.86
-0.40
-4.34%
AAMI
Acadian Asset Management
71.58
42.43
145.56%
TRIN
Trinity Capital
16.49
4.13
33.41%
Sixth Street Specialty Lending Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Sixth Street Specialty Lending Issues New Unsecured Notes
Positive
May 14, 2026
On May 14, 2026, Sixth Street Specialty Lending, Inc. entered into a third supplemental indenture with U.S. Bank Trust Company to support the issuance of $300 million of 5.650% unsecured notes due August 15, 2031, with semiannual interest payments...
Business Operations and StrategyExecutive/Board ChangesDividendsFinancial DisclosuresPrivate Placements and Financing
Sixth Street Specialty Lending Cuts Dividend, Extends Credit Line
Negative
May 5, 2026
On May 5, 2026, Sixth Street Specialty Lending reported first-quarter 2026 net investment income of $0.42 per share and a net loss of $0.27 per share for the period ended March 31, 2026, reflecting an annualized 9.9% ROE on net investment income a...
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Sixth Street Specialty Lending Announces Leadership Transition Plans
Neutral
Feb 23, 2026
On February 19, 2026, Sixth Street Specialty Lending, Inc. announced that Chairman of the Board Joshua Easterly will not seek re-election at the May 21, 2026 annual shareholders’ meeting and plans to retire from affiliated firm Sixth Street ...
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.