Goldman Sachs BDC: Contrarian Buy Near 1-Year Lows (Rating Upgrade)

The Asian Investor
28.8K Followers
(7min)

Summary

  • Goldman Sachs BDC's non-accrual percentage has improved, and shares now trade at a discount to book value, presenting a contrarian buying opportunity.
  • Despite increased non-performing loans, Goldman Sachs BDC's dividend remains well-supported by net investment income, with a coverage ratio of 1.29X in Q3'24.
  • The investment firm's reliance on variable rate loans poses a risk, but the dividend appears secure unless non-accrual loans increase or net investment income drops significantly.
  • Investors with high risk tolerance may find Goldman Sachs BDC attractive due to its potential to narrow the share price and net asset value gap.

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ryasick

Shares of Goldman Sachs BDC (NYSE:GSBD) have revalued sharply lower in FY 2024 as the BDC suffered an unexpected increase in the non-accrual percentage this year, triggering investor concerns about the BDC's dividend. Goldman Sachs BDC is still dealing

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Analyst’s Disclosure: I/we have a beneficial long position in the shares of GSBD, ARCC either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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