OBDC

Blue Owl Capital Corp is a business development company that originates loans to U.S. upper-middle-market companies (those generating more than $50 million of EBITDA annually), per the 10-K MD&A. FY2025 net income was $627M (+5.5%), but diluted EPS slipped to $1.24 (-19.0%) as the share count and asset base grew faster than earnings. At $10.87 the stock trades at 8.8x EPS, and with stockholders' equity of $7.40B against 499M shares the price sits below book value, the typical pattern for a BDC the market views with some caution.

The income story is the draw: OBDC paid $753M of dividends in FY2025 (+14.8%) and bought back $148M of stock, returning substantial cash to holders, and operating cash flow surged to $1.74B. But the quality flags are real. Return on equity is only 8.5%, retained earnings turned negative at -$120M (YoY -508.0%), and net income has been choppy across the cycle ($625M in FY2021, $466M FY2022, $793M FY2023, $595M FY2024, $627M FY2025) rather than steadily compounding. The dividend is being funded against a backdrop where distributions exceed retained capital.