Saratoga Investment Corp (NYSE:SAR) Declares Monthly Dividend of $0.25

Key Points

• Saratoga Investment declared a monthly dividend of $0.25 per share, payable December 22 to shareholders of record December 3. The payment implies a 17.3% annualized yield.
• Dividend sustainability may be a concern: the current payout ratio is 90.4%, while analysts expect next year’s earnings of $2.00 per share versus $3.00 in annual dividends.
• SAR shares recently traded at $17.35, near their 52-week low, after the company missed quarterly earnings estimates. Analysts maintain a consensus “Hold” rating with an average price target of $21.50.

Saratoga Investment Corp (NYSE:SAR - Get Free Report) announced a monthly dividend on Wednesday, September 9th. Investors of record on Thursday, December 3rd will be given a dividend of 0.25 per share by the financial services provider on Tuesday, December 22nd. This represents a c) dividend on an annualized basis and a dividend yield of 17.3%. The ex-dividend date is Thursday, December 3rd.

Saratoga Investment has increased its dividend payment by an average of 0.2%per year over the last three years. Saratoga Investment has a payout ratio of 90.4% indicating that its dividend is currently covered by earnings, but may not be in the future if the company's earnings fall. Equities research analysts expect Saratoga Investment to earn $2.00 per share next year, which means the company may not be able to cover its $3.00 annual dividend with an expected future payout ratio of 150.0%.

Saratoga Investment Stock Performance

Shares of SAR traded down $0.10 during mid-day trading on Wednesday, hitting $17.35. The stock had a trading volume of 185,143 shares, compared to its average volume of 134,058. The firm has a market cap of $278.99 million, a P/E ratio of 17.35 and a beta of 0.54. Saratoga Investment has a 52 week low of $17.20 and a 52 week high of $25.15. The company has a debt-to-equity ratio of 0.18, a current ratio of 0.09 and a quick ratio of 0.09. The business has a fifty day moving average price of $19.16 and a 200-day moving average price of $21.30.

Saratoga Investment (NYSE:SAR - Get Free Report) last issued its earnings results on Tuesday, July 7th. The financial services provider reported $0.47 earnings per share for the quarter, missing analysts' consensus estimates of $0.54 by ($0.07). The business had revenue of $30.78 million for the quarter, compared to the consensus estimate of $31.38 million. Saratoga Investment had a return on equity of 8.76% and a net margin of 12.70%. On average, equities research analysts expect that Saratoga Investment will post 1.94 EPS for the current year.

Analysts Set New Price Targets

A number of research analysts have weighed in on the company. Weiss Ratings lowered Saratoga Investment from a "hold (c)" rating to a "hold (c-)" rating in a report on Wednesday, July 8th. Oppenheimer dropped their price target on Saratoga Investment from $22.00 to $21.00 and set a "market perform" rating for the company in a research note on Thursday, July 9th. Zacks Research raised shares of Saratoga Investment from a "strong sell" rating to a "hold" rating in a research note on Monday. Finally, B. Riley Financial decreased their price target on Saratoga Investment from $23.00 to $22.00 and set a "neutral" rating on the stock in a research note on Thursday, July 9th. Six investment analysts have rated the stock with a Hold rating, According to data from MarketBeat, the stock currently has an average rating of "Hold" and a consensus target price of $21.50.

Saratoga Investment Company Profile

Saratoga Investment Corp. is a closed-end, externally managed investment company that seeks to generate current income and total return through a diversified portfolio of private U.S. companies. Trading on the New York Stock Exchange under the ticker SAR, the firm primarily targets middle-market businesses across a broad range of industries, including industrials, healthcare, consumer products, financial services and technology. Its investment approach combines debt and equity instruments, providing flexible capital solutions such as first-lien and second-lien secured loans, mezzanine debt, preferred equity and common equity positions.

As an actively managed vehicle, Saratoga Investment works closely with portfolio companies’ management teams to support growth initiatives, operational improvements, and strategic transactions.

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