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1. Company Snapshot

1.a. Company Description

SLR Investment Corp.is a business development company specializing in secured debt (first lien unitranche and second lien), subordinated (unsecured) debt, minority equity, leveraged buyouts, acquisitions, recapitalizations, general refinancing, growth capital and strategic income-oriented control equity investments in leveraged middle market companies.The fund invests in aerospace and defense; air freight & logistics; asset management; automotive; banking; beverage, food and tobacco; building products; buildings and real estate; broadcasting and entertainment; cargo transport; commercial services and supplies; communications equipment; chemicals, plastics and rubber; containers, packaging and glass; construction & engineering; diversified/conglomerate manufacturing; consumer Finance; distributors; diversified/conglomerate services; diversified financial services; diversified real estate activities; food products; Footwear; Education Services; diversified telecommunications services; electronics; farming and agriculture; finance; grocery; health care equipment and supplies; health care facilities; education and childcare; home and office furnishing, durable consumer products; hotels, motels, inns and gaming; insurance; restaurants, leisure, amusement, and entertainment; leisure equipment tolls and services, media, multiline retail, multi sector holdings; paper and forest products; personal products; professional services, research and consulting services, software; specialty retail; textiles apparel and luxury goods, thrifts and mortgage finance, trading companies and distributors, utilities, and wireless telecommunication services; industrial conglomerates; internet software and services, IT services, machinery; mining, steel, iron, and non-precious metals; oil and gas; personal, food and miscellaneous services; printing and publishing; retail stores; telecommunications; textiles and leather; and utilities.


It also invests in life sciences with focus on specialty pharmaceuticals, medical devices, biotech, health Care Providers and services; health Care technology, enabling technologies and tools.The fund primarily invests in United States.The fund's investments generally range between $5 million and $100 million.


The fund invests in companies with revenues between $50 million and $1 billion and EBITDA between $15 million and $100 million.It invests in the form of senior secured loans, mezzanine loans, and equity securities.It may also seek investments in thinly traded public companies and also make secondary investments.


The fund makes non-control equity investments.It primarily exits within three years of the initial capital commitment.

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1.b. Last Insights on SLRC

SLR Investment Corp.'s recent performance was negatively impacted by its Q2 earnings miss, with net investment income per share of $0.40, falling short of the previous year's $0.45 per share. The company's earnings call highlighted a challenging environment, with a slight decline in NAV and NII. Despite maintaining a stable dividend payout of $0.41 per share, concerns about the company's ability to meet future earnings expectations have grown. Additionally, the upcoming release of its Q3 financial results on November 4, 2025, may provide further insight into the company's performance.

1.c. Company Highlights

2. SLR Investment Corp. Posts Stable Q3 2025 Earnings Amidst Conservative Private Credit Investing

SLR Investment Corp. (SLRC) reported net investment income of $0.40 per share and net income of $0.43 per share for Q3 2025, slightly missing analyst estimates of $0.41 for EPS. The company's net asset value (NAV) per share stood at $18.21, showing a slight increase quarter-over-quarter and remaining flat year-over-year. The annualized return on equity was 9.4%, indicating a stable performance. As of September 30, SLRC had over $850 million in available capital, with a net asset value of $993.3 million, or $18.21 per share.

Publication Date: Nov -29

📋 Highlights
  • Net Investment Income & Net Income: Earned $0.40 and $0.43 per share, respectively, reflecting stable earnings.
  • Portfolio Growth: New originations surged 12.7% YoY to $447M, with $419M in repayments, netting $28M in new investments.
  • Specialty Finance Dominance: 83% of the $2.1B loan portfolio in specialty finance (12.2% yield), vs. 15.3% in cash flow loans.
  • High Dividend Yield: Declared $0.41/share dividend, offering a 10.7% dividend yield, supported by $850M in available capital.
  • Life Science Momentum: $218M in life science loans (12.3% yield) with tripled pipeline size YoY, targeting FDA-approaching companies.

Portfolio Composition and Performance

The company's investment portfolio, valued at approximately $2.1 billion across 109 portfolio companies and 31 industries, demonstrated a shift towards specialty finance strategies, with 83% of the loan portfolio in these investments and 15.3% in cash flow loans. The weighted average yield on the portfolio was 12.2%, with 98.2% consisting of senior secured loans and 99.5% of debt investments performing. Michael Gross noted that their valuations are based on external inputs, including portfolio growth, returns, and market comps, which drove the valuation expansion in their ABL franchises.

Capital Management and Dividend

The Board of SLRC declared a Q4 2025 quarterly base distribution of $0.41 per share. SLRC issued $50 million and $75 million of 3-year unsecured notes in July and August at fixed interest rates of 5.96% and 5.95%, respectively, indicating effective capital management. The company's dividend yield stands at 10.3%, presenting an attractive investment opportunity, especially considering the SLR team's significant ownership and investment in the stock.

Valuation and Growth Prospects

SLRC's current P/E Ratio is 9.65, and the P/B Ratio is 0.87, suggesting a relatively undervalued position given its stable earnings and net asset value. Analysts estimate next year's revenue growth at -1.4%. The company's focus on direct asset-based lending and specialty finance strategies, along with a seasoned life science finance team, positions it well for potential growth opportunities, particularly in the life science sector, where the pipeline is the highest in over 2 years.

Operational Highlights and Outlook

The life science portfolio totaled $218 million across 9 borrowers, with 88% invested in companies with over 12 months of cash runway, and a weighted average yield of 12.3%. The sponsor finance cash flow business saw modest improvement, with a portfolio of $500 million across 31 borrowers. The company's ability to offer both cash flow and ABL solutions is viewed as a strategic advantage, with opportunities in both ABL and cash flow lending, particularly in healthcare, expected to drive future performance.

3. NewsRoom

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Investor Panic Creates A +10% Yield Opportunity: SLRC

Nov -23

Source: seekingalpha.com

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Dividend Power Dogs: 12 Ideal Safer November Stars

Nov -16

Source: seekingalpha.com

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SLR Investment Corp. (SLRC) Q3 2025 Earnings Call Transcript

Nov -05

Source: seekingalpha.com

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SLR Investment Corp. Announces Quarter Ended September 30, 2025 Financial Results

Nov -04

Source: globenewswire.com

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Buy The Dip: Bargain Dividend Stocks On Sale

Nov -01

Source: seekingalpha.com

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SLR Investment: A BDC With Less Risk, And More Upside Than Some Peers

Oct -22

Source: seekingalpha.com

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SLR Investment Corp. (NASDAQ:SLRC) Receives Consensus Recommendation of “Hold” from Brokerages

Oct -22

Source: defenseworld.net

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SLR Capital Partners Welcomes Mac Fowle as President of Asset-Based Lending

Oct -14

Source: prnewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.50%)

6. Segments

Investment and Related Activities

Expected Growth: 10.5%

The Investment and Related Activities segment is expected to grow driven by increasing demand for loan originations and portfolio acquisitions, coupled with SLR Investment Corp's expertise in managing diversified loan portfolios.

7. Detailed Products

Real Estate Investment Trusts (REITs)

SLR Investment Corp. offers a diversified portfolio of REITs, providing investors with a stable source of income and potential long-term capital appreciation.

Commercial Mortgage-Backed Securities (CMBS)

SLR Investment Corp. invests in CMBS, which are backed by a pool of commercial mortgages, offering a stable source of income and diversification benefits.

Residential Mortgage-Backed Securities (RMBS)

SLR Investment Corp. invests in RMBS, which are backed by a pool of residential mortgages, offering a stable source of income and diversification benefits.

Asset-Based Financing

SLR Investment Corp. provides asset-based financing solutions to businesses, enabling them to access capital and optimize their balance sheets.

Real Estate Joint Ventures

SLR Investment Corp. partners with real estate developers and operators to co-invest in properties, providing a source of capital and expertise.

8. SLR Investment Corp.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for SLR Investment Corp. is moderate due to the availability of alternative investment options for clients.

Bargaining Power Of Customers

The bargaining power of customers is low for SLR Investment Corp. as clients have limited negotiating power due to the company's strong brand reputation and diversified investment portfolio.

Bargaining Power Of Suppliers

The bargaining power of suppliers is moderate for SLR Investment Corp. as the company relies on a diverse range of suppliers, reducing dependence on any one supplier.

Threat Of New Entrants

The threat of new entrants is high for SLR Investment Corp. due to the relatively low barriers to entry in the investment industry, making it easier for new companies to enter the market.

Intensity Of Rivalry

The intensity of rivalry is high for SLR Investment Corp. due to the highly competitive nature of the investment industry, with many established players competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 54.42%
Debt Cost 6.16%
Equity Weight 45.58%
Equity Cost 9.43%
WACC 7.65%
Leverage 119.37%

11. Quality Control: SLR Investment Corp. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
SLR Investment

A-Score: 7.7/10

Value: 6.9

Growth: 6.6

Quality: 7.8

Yield: 10.0

Momentum: 5.0

Volatility: 10.0

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Tortoise Energy Infrastructure

A-Score: 7.6/10

Value: 4.3

Growth: 6.6

Quality: 9.0

Yield: 10.0

Momentum: 6.0

Volatility: 9.7

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MidCap Financial

A-Score: 7.1/10

Value: 6.7

Growth: 5.8

Quality: 7.8

Yield: 10.0

Momentum: 3.0

Volatility: 9.7

1-Year Total Return ->

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New Mountain Finance

A-Score: 6.8/10

Value: 7.1

Growth: 4.1

Quality: 7.7

Yield: 10.0

Momentum: 2.0

Volatility: 9.7

1-Year Total Return ->

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Capital Southwest

A-Score: 6.6/10

Value: 5.8

Growth: 3.2

Quality: 7.7

Yield: 10.0

Momentum: 3.0

Volatility: 9.7

1-Year Total Return ->

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WhiteHorse Finance

A-Score: 5.6/10

Value: 5.9

Growth: 3.6

Quality: 5.2

Yield: 10.0

Momentum: 0.5

Volatility: 8.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

15.61$

Current Price

15.62$

Potential

-0.00%

Expected Cash-Flows