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BBDC

Barings BDC NYSE:BBDC Stock Report

Last Price

US$8.52

Market Cap

US$930.6m

7D

-1.7%

1Y

-22.6%

Updated

05 Oct, 2022

Data

Company Financials +
BBDC fundamental analysis
Snowflake Score
Valuation2/6
Future Growth4/6
Past Performance1/6
Financial Health1/6
Dividends2/6

BBDC Stock Overview

Barings BDC, Inc. (NYSE: BBDC) is a publicly traded, externally managed investment company that has elected to be treated as a business development company under the Investment Company Act of 1940.

Barings BDC Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Barings BDC
Historical stock prices
Current Share PriceUS$8.52
52 Week HighUS$11.55
52 Week LowUS$8.04
Beta0.59
1 Month Change-13.24%
3 Month Change-10.50%
1 Year Change-22.62%
3 Year Change-15.73%
5 Year Change-38.93%
Change since IPO-46.75%

Recent News & Updates

Sep 16

Barings BDC: A Cheap Capital Markets Investment Company, But Trending Lower

Summary Investors have found relative safety in high-dividend companies this year. Financials engaged in Capital Markets have not caught a bid, though. One firm is caught in the middle and features somewhat low volatility and a solid dividend. The technicals are not so sanguine, however. What's worked in 2022? High dividend stocks. The iShares Core High Dividend ETF (HDV) is positive since last November, back when so many once-high-flying tech stocks and small caps peaked. What hasn't worked in that time? Capital Markets stocks, as evidenced by a 27% plunge in the SPDR S&P Capital Markets ETF (KCE). Amid a freeze in IPO activity and reduced M&A as interest rates have risen, Financials sector stocks that rely on dealmaking have struggled. This comes as some niches of the sector are doing fine, such as regional banks. One small closed-end management company that targets the middle market for investment opportunities pays a big dividend, but it, too, is stuck in a downtrend. Hot: Dividend Stocks. Not: Capital Markets Companies. Stockcharts.com According to Bank of America Global Research, Barings BDC Inc (BBDC) is a specialty finance company, regulated as a BDC that invests in debt and equity of middle market businesses. The company's objective is to achieve high total returns through current income from its debt investments and capital appreciation from equity investments. The company has some upside potential fundamentally due to its origination platform and a portfolio geared toward the tail end of the credit cycle, which we appear to be in. Downside risks include deteriorating credit markets even with a stable portfolio, reduced investment and capital markets activity, which has already been reported by some investment banks, and generally poor investment performance expectations. The North Carolina-based $1.1 billion market cap Capital Markets industry company within the Financials sector trades at an elevated 22.6 trailing 12-month GAAP price-to-earnings ratio and pays a very high 9.7% dividend yield. On valuation, BofA sees earnings growing sharply this year after a strong 2021 rebound. EPS is then expected to slow down through 2024, but the Bloomberg consensus forecast is more upbeat looking forward. Dividends are anticipated to increase through next year, resulting in a continued high yield, perhaps in the double digits. Its NAV is about $11.50 at last check and its forward GAAP P/E is near 10, which is quite cheap. BBDC: Earnings, Dividend, Valuation Forecasts BofA Global Research Looking ahead, BBDC's corporate event calendar by Wall Street Horizon is quiet. It has a Q3 unconfirmed earnings date of Wednesday, November 9, after market close. Corporate Event Calendar Wall Street Horizon The Technical Take Baring's valuation and dividend yield are compelling, but its chart is mired in a downtrend that dates back to November last year. After rallying sharply to a high above $11.50, shares have dropped almost 20% with lower highs and lower lows throughout the year. The stock also found resistance at its downtrending 200-day moving average last month, which had confluence with its downtrend resistance line. Also notice the 'volume by price' indicator on the left - once BBDC rallied to the bar indicating the highest volume of shares previously traded, the stock quickly retreated. The $10 to $10.50 range is clearly resistance.

Shareholder Returns

BBDCUS Capital MarketsUS Market
7D-1.7%3.0%1.9%
1Y-22.6%-21.4%-18.8%

Return vs Industry: BBDC underperformed the US Capital Markets industry which returned -20.7% over the past year.

Return vs Market: BBDC underperformed the US Market which returned -18.2% over the past year.

Price Volatility

Is BBDC's price volatile compared to industry and market?
BBDC volatility
BBDC Average Weekly Movement3.5%
Capital Markets Industry Average Movement0.4%
Market Average Movement7.0%
10% most volatile stocks in US Market15.5%
10% least volatile stocks in US Market2.9%

Stable Share Price: BBDC is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: BBDC's weekly volatility (3%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
2006n/aJonathan Bockhttps://www.barings.com/en-us/guest/funds/barings-bdc

Barings BDC, Inc. (NYSE: BBDC) is a publicly traded, externally managed investment company that has elected to be treated as a business development company under the Investment Company Act of 1940. It seeks to invest primarily in senior secured loans, first lien debt, unitranche, second lien debt, subordinated debt, equity co-investments and senior secured private debt investments in private middle-market companies that operate across a wide range of industries. It specializes in mezzanine, leveraged buyouts, management buyouts, ESOPs, change of control transactions, acquisition financings, growth financing, and recapitalizations in lower middle market, mature, and later stage companies.

Barings BDC Fundamentals Summary

How do Barings BDC's earnings and revenue compare to its market cap?
BBDC fundamental statistics
Market CapUS$930.62m
Earnings (TTM)US$21.93m
Revenue (TTM)US$170.94m

42.4x

P/E Ratio

5.4x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
BBDC income statement (TTM)
RevenueUS$170.94m
Cost of RevenueUS$0
Gross ProfitUS$170.94m
Other ExpensesUS$149.01m
EarningsUS$21.93m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)0.20
Gross Margin100.00%
Net Profit Margin12.83%
Debt/Equity Ratio122.3%

How did BBDC perform over the long term?

See historical performance and comparison

Dividends

11.3%

Current Dividend Yield

333%

Payout Ratio
We’ve recently updated our valuation analysis.

Valuation

Is BBDC undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for BBDC?

Other financial metrics that can be useful for relative valuation.

BBDC key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue13.3x
Enterprise Value/EBITDAn/a
PEG Ratio0.4x

Price to Earnings Ratio vs Peers

How does BBDC's PE Ratio compare to its peers?

BBDC PE Ratio vs Peers
The above table shows the PE ratio for BBDC vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average17x
VRTS Virtus Investment Partners
7.6xn/aUS$1.2b
BCOR Blucora
44.5x47.2%US$1.0b
NOAH Noah Holdings
5.5x13.0%US$938.8m
PZN Pzena Investment Management
10.4xn/aUS$697.6m
BBDC Barings BDC
42.4x99.1%US$930.6m

Price-To-Earnings vs Peers: BBDC is expensive based on its Price-To-Earnings Ratio (42.4x) compared to the peer average (17x).


Price to Earnings Ratio vs Industry

How does BBDC's PE Ratio compare vs other companies in the US Capital Markets Industry?

Price-To-Earnings vs Industry: BBDC is expensive based on its Price-To-Earnings Ratio (42.4x) compared to the US Capital Markets industry average (25.1x)


Price to Earnings Ratio vs Fair Ratio

What is BBDC's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

BBDC PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio42.4x
Fair PE Ratio52.9x

Price-To-Earnings vs Fair Ratio: BBDC is good value based on its Price-To-Earnings Ratio (42.4x) compared to the estimated Fair Price-To-Earnings Ratio (52.9x).


Share Price vs Fair Value

What is the Fair Price of BBDC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: BBDC ($8.52) is trading above our estimate of fair value ($2.52)

Significantly Below Fair Value: BBDC is trading above our estimate of fair value.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.


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Future Growth

How is Barings BDC forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


99.1%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: BBDC's forecast earnings growth (99.1% per year) is above the savings rate (1.9%).

Earnings vs Market: BBDC's earnings (99.1% per year) are forecast to grow faster than the US market (14.8% per year).

High Growth Earnings: BBDC's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: BBDC's revenue (17% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: BBDC's revenue (17% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if BBDC's Return on Equity is forecast to be high in 3 years time


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Past Performance

How has Barings BDC performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


47.0%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: BBDC has a large one-off loss of $84.7M impacting its June 30 2022 financial results.

Growing Profit Margin: BBDC's current net profit margins (12.8%) are lower than last year .


Past Earnings Growth Analysis

Earnings Trend: BBDC's earnings have grown significantly by 47% per year over the past 5 years.

Accelerating Growth: BBDC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: BBDC had negative earnings growth (-81.4%) over the past year, making it difficult to compare to the Capital Markets industry average (33.2%).


Return on Equity

High ROE: BBDC's Return on Equity (1.8%) is considered low.


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Financial Health

How is Barings BDC's financial position?

Financial Health Score

1/6

Financial Health Score 1/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: BBDC's short term assets ($436.4M) exceed its short term liabilities ($29.4M).

Long Term Liabilities: BBDC's short term assets ($436.4M) do not cover its long term liabilities ($1.5B).


Debt to Equity History and Analysis

Debt Level: BBDC's net debt to equity ratio (106.5%) is considered high.

Reducing Debt: BBDC's debt to equity ratio has increased from 75.6% to 122.3% over the past 5 years.

Debt Coverage: BBDC's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: BBDC's interest payments on its debt are not well covered by EBIT (2.9x coverage).


Balance Sheet


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Dividend

What is Barings BDC current dividend yield, its reliability and sustainability?

Dividend Score

2/6

Dividend Score 2/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Cash Flow Coverage


11.27%

Current Dividend Yield

Dividend Yield vs Market

Barings BDC Dividend Yield vs Market
How does Barings BDC dividend yield compare to the market?
SegmentDividend Yield
Company (Barings BDC)11.3%
Market Bottom 25% (US)1.6%
Market Top 25% (US)4.5%
Industry Average (Capital Markets)2.8%
Analyst forecast in 3 Years (Barings BDC)11.4%

Notable Dividend: BBDC's dividend (11.27%) is higher than the bottom 25% of dividend payers in the US market (1.6%).

High Dividend: BBDC's dividend (11.27%) is in the top 25% of dividend payers in the US market (4.53%)


Stability and Growth of Payments

Stable Dividend: BBDC's dividend payments have been volatile in the past 10 years.

Growing Dividend: BBDC's dividend payments have fallen over the past 10 years.


Earnings Payout to Shareholders

Earnings Coverage: With its high payout ratio (332.7%), BBDC's dividend payments are not well covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: BBDC is paying a dividend but the company has no free cash flows.


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Management

How experienced are the management team and are they aligned to shareholders interests?

0.2yrs

Average management tenure


CEO

Jonathan Bock

0.17yr

Tenure

Mr. Jonathan Gerald Bock, also known as Jon, CFA, serves as Chief Executive Officer at Barings BDC, Inc. since August 2022. He is Co-Chief Executive Officer & President at Barings Private Credit Corporatio...


Leadership Team

Experienced Management: BBDC's management team is not considered experienced ( 0.2 years average tenure), which suggests a new team.


Board Members

Experienced Board: BBDC's board of directors are considered experienced (3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

NYSE:BBDC Recent Insider Transactions by Companies or Individuals
DateValueNameEntityRoleSharesMax Price
17 Jun 22BuyUS$2,188Stephen ByersIndividual236US$9.27
03 Jun 22BuyUS$19,194Stephen ByersIndividual1,850US$10.38
09 May 22BuyUS$164,352Stephen ByersIndividual16,035US$10.25
01 Dec 21BuyUS$53,997David MihalickIndividual5,000US$10.80
29 Nov 21BuyUS$54,249Thomas McDonnellIndividual5,000US$10.85

Ownership Breakdown

What is the ownership structure of BBDC?
Owner TypeNumber of SharesOwnership Percentage
Individual Insiders536,2560.5%
Private Companies13,639,68112.5%
Institutions39,119,79835.8%
General Public55,932,05651.2%

Dilution of Shares: Shareholders have been substantially diluted in the past year, with total shares outstanding growing by 67.2%.


Top Shareholders

Top 25 shareholders own 39.92% of the company
OwnershipNameSharesCurrent ValueChange %Portfolio %
12.49%
Barings LLC
13,639,681$116.2m0%no data
4.43%
Ares Management LLC
4,839,852$41.2m-9.54%2.04%
3.68%
RiverNorth Capital Management, LLC
4,014,184$34.2m69.26%1.51%
2.43%
Punch & Associates Investment Management, Inc.
2,656,926$22.6m1.22%1.55%
1.89%
UBS Asset Management
2,060,090$17.6m-7.52%no data
1.82%
Callodine Capital Management, LP
1,987,689$16.9m82.78%5.35%
1.44%
Cliffwater LLC
1,569,316$13.4m10.99%4.47%
1.38%
Wells Fargo & Company, Securities and Brokerage Investments
1,502,222$12.8m37.19%0.01%
1.29%
Relative Value Partners Group, LLC
1,413,119$12.0m1.97%1.01%
1.28%
Van Eck Associates Corporation
1,399,960$11.9m18.72%0.02%
0.83%
Millennium Management LLC
910,114$7.8m81.56%0.01%
0.73%
T. Rowe Price Group, Inc.
792,351$6.8m-0.1%no data
0.67%
Dimension Capital Management LLC
734,409$6.3m-2.99%1.5%
0.63%
Two Sigma Advisers, LP
685,500$5.8m-27.97%0.02%
0.61%
Legal & General Investment Management Limited
666,606$5.7m88.01%no data
0.56%
Nicola Wealth Management Ltd.
614,000$5.2m0%0.51%
0.55%
ClearBridge Investments, LLC
604,822$5.2m0%no data
0.5%
Confluence Investment Management LLC
542,991$4.6m-0.72%0.07%
0.44%
Cambridge Investment Research Advisors, Inc.
484,632$4.1m-24.11%0.02%
0.39%
BlackRock, Inc.
424,539$3.6m15.02%no data
0.38%
Castleview Partners, LLC
419,866$3.6m950.51%0.02%
0.38%
Advisors Asset Management, Inc.
418,359$3.6m-2.11%0.07%
0.37%
Morgan Stanley, Investment Banking and Brokerage Investments
407,477$3.5m-4.81%no data
0.37%
Royce & Associates, LP
406,894$3.5m0%0.03%
0.37%
Two Sigma Investments, LP
406,313$3.5m-52.74%0.01%

Company Information

Barings BDC, Inc.'s employee growth, exchange listings and data sources


Key Information


Number of Employees


Location

  • Barings BDC, Inc.
  • 300 South Tryon Street
  • Suite 2500
  • Charlotte
  • North Carolina
  • 28202
  • United States


Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
BBDCNYSE (New York Stock Exchange)YesCommon StockUSUSDFeb 2007
TRYDB (Deutsche Boerse AG)YesCommon StockDEEURFeb 2007

Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/10/05 00:00
End of Day Share Price2022/10/05 00:00
Earnings2022/06/30
Annual Earnings2021/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.