MA

Main Street Capital Corp

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Main Street Capital Corp AI Insights

Informational only. Not investment advice.
As of 2025-12-12

Snapshot

  • Net margin 86% TTM vs industry median 95% - BDC model converts nearly all revenue to income with minimal operating drag (68M opex on 623M revenue)[Net Margin]
  • EPS growth 23% 3Y CAGR vs industry median 7% - outpacing peers 3x while maintaining 19% ROE TTM (2.2x industry median)[EPS Growth 3Y]
  • Dividend yield 7.6% TTM ($4.21/share) with 1.4x coverage from EPS ($6.04) - sustainable payout with growth buffer[Dividends Paid Per Share]

Watch Triggers

  • Book Value Per Share: Decline >5% QoQ — Signals portfolio credit deterioration - NAV erosion directly impacts dividend sustainability
  • Net Margin: Falls below 80% — Indicates rising credit losses or spread compression - threatens dividend coverage
  • Debt to Equity: Rises above 1.0x — BDC leverage limits constrain growth and increase regulatory risk

Bull Case

Premium BDC economics: 86% net margin TTM with 19% ROE generates sustainable 7.6% yield while growing EPS 23% annually - rare income + growth combo

Net MarginROEEPS Growth 3YDividends Paid Per Share

Self-funding model: Interest income (140M) exceeds interest expense (130M) TTM - positive spread insulates from rate volatility

Interest IncomeInterest Expense

Bear Case

Credit cycle exposure: 2.1B total debt at 0.73x D/E with portfolio concentrated in middle-market loans - recession could impair NAV materially

Total DebtDebt to EquityBook Value Per Share

Premium valuation risk: P/B 1.9x vs tangible book $32.74 - trading 90% above NAV limits downside protection if credit deteriorates

P/B RatioBook Value Per ShareTangible Book Value

Bull vs Bear Balance

AI-generated sentiment analysis based on fundamental metrics and market conditions.

BearBull
60%

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Forward Thesis

Dividend growth to accelerate as 28% 3Y revenue CAGR flows through to distributable income

1-3ymed
  • Revenue growth 28% 3Y CAGR vs 7% industry median
  • Operating leverage - opex only 11% of revenue
  • Interest income 140M exceeds interest expense 130M
EPS $6.04 TTM covers $4.21 dividend 1.4xROE 19% TTM sustains reinvestment capacityNet debt 2.1B at 0.73x D/E is manageable
Valuation Context
Caveats

Public Strategies Rankings

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Fundamental company data provided by Morningstar, updated daily.

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