Golub Capital BDC, Inc. (NASDAQ:GBDC)

CAPS Rating: 3 out of 5

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Member Avatar TMFValueMagnet (92.67) Submitted: 3/18/2014 6:48:25 PM : Outperform Start Price: $17.17 GBDC Score: -5.73

The new Senior Loan Fund offers an opportunity to add to GBDC's portfolio yields/dividend. I estimate SLF yields could top 17% annually including origination fees on new transactions.

Regulatory limits cap the SLF at 30% of assets. If sized at 30%, GBDC's portfolio yields would grow up to 2.5 percentage points, bringing more attention to this well-managed company.

Finally, its ability to continuously raise funds at share prices above NAV leads me to believe that early investors will be rewarded as new offerings add to NAV per share.

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