Ilija Erceg
Introduction
With increased uncertainty surrounding the economy from tariff impacts, and how long the Fed will keep interest rates elevated, many investors may be left wondering how the BDC (BIZD) sector will fare for the remainder
FS KKR Capital: A Risky Yield, But I Think The Dividend Remains Safe For 2025
Summary
- FS KKR Capital's dividend appears safe for 2025, supported by robust liquidity and spillover income, despite recent disappointing performance and economic uncertainty.
- Credit quality has improved, with non-accruals down significantly year-over-year, though still higher than major peers like ARCC and BXSL.
- Valuation is attractive at a 13% discount to NAV and a forward yield near 14%, but economic risks and sector exposures warrant caution.
- I maintain a Hold rating, advising investors to wait for more economic clarity before adding, as tighter dividend coverage and NAV erosion remain concerns.
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Contributing analyst to the iREIT+Hoya Capital investment group. The Dividend Collectuh is not a registered investment professional nor financial advisor and these articles should not be taken as financial advice. This is for educational purposes only and I encourage everyone to do their own due diligence. I'm a Navy veteran who enjoys dividend investing in quality blue-chip stocks, BDC's, and REITs. I am a buy-and-hold investor who prefers quality over quantity and plans to supplement his retirement income and live off dividends in the next 5-7 years. I aspire to reach and help the hard working, lower and middle class workers build investment portfolios of high quality, dividend-paying companies. I also hope to give investors a new perspective to help them reach financial independence.
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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