FS KKR Capital: Truly Humbled By April's Roller Coaster Ride (Rating Downgrade)

(8min)

Summary

  • Market volatility, triggered by trade tensions and tariffs, has exposed risks even for leading private credit players like FSK.
  • FSK's attractive 13%+ dividend yield could face imminent risks, as adjusted NII per share may not fully cover distributions through 2025 and 2026.
  • Despite a resilient and diversified portfolio, ongoing rate headwinds and execution risks justify a cautious stance on FSK.
  • Given April's sharp selloff and uncertain outlook, I urge BDC investors to consider moving on from FSK before the next rainy day arrives.
  • Looking for a helping hand in the market? Members of Ultimate Growth Investing get exclusive ideas and guidance to navigate any climate. Learn More »

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FSK: April's Significant Volatility Offers A Lesson On Humility

The naysayers were right after all. We must be careful about market volatility that could hamper even the leading players in the private credit space. And market volatility

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JR Research is an opportunistic investor. He was recognized by TipRanks as a Top Analyst. He was also recognized by Seeking Alpha as a "Top Analyst To Follow" for Technology, Software, and Internet, as well as for Growth and GARP.

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He tends to avoid overhyped and overvalued stocks while capitalizing on battered stocks with significant upside recovery possibilities.

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Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. 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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