Saratoga Investment reported Assets Under Management of $1.126 billion for the fiscal first quarter ended May 31, 2026, representing a 1.6% increase from the prior quarter. The business development company missed analyst expectations for the period, with adjusted earnings per share of $0.47 falling short of the $0.55 consensus estimate. This represents a 28.8% decrease from earnings of $0.66 per share in the same period last year. Quarterly sales of $30.777 million also missed the $31.258 million estimate by 1.54%, a 4.77% decrease year-over-year.
Financial Performance
Total Investment Income for the quarter was $30.8 million, a decrease from $32.3 million in the same period last year. Net Investment Income per share stood at $0.47, compared to $0.66 in the prior year. The company reported a net loss per share of $(0.42) for the quarter, compared to earnings per share of $0.91 in the year-ago period. Adjusted Net Investment Income per share was $0.47. The decline in earnings reflects the impact of significantly lower short-term interest rates and tightening spreads on the company's largely floating rate asset base.
Asset Valuation and Portfolio
Net Asset Value decreased to $378.5 million as of May 31, 2026, down 4.5% from $396.2 million in the prior quarter. NAV per share fell to $23.23 from $24.40 in the prior quarter. The portfolio fair value was marked down by $15.2 million during the quarter, primarily due to unrealized depreciation in the non-CLO core portfolio. Specific credits such as Pepper Palace, Exigo, and Chronus contributed significantly to the markdowns. Pepper Palace was written down to zero, while Exigo was moved to a red watch list status.
Capital and Liquidity
Saratoga Investment held $60.8 million in cash and cash equivalents at quarter-end. The company had total undrawn borrowing capacity of $196.8 million as of May 31, 2026, including $46 million available through its SBI3 license and $90 million from revolving credit facilities. Outstanding borrowings totaled $817.4 million, including amounts under senior secured revolving credit facilities and various debentures and notes.
Dividend Declaration
The Board of Directors declared a base quarterly dividend of $0.75 per share for the second quarter of fiscal 2027. This dividend will be paid in three monthly installments of $0.25 per share in June, July, and August 2026, with record dates in July, August, and September respectively. The annualized yield represents 14% based on the stock price of $21.42 as of July 6, 2026.
| Metric |
Q1 FY27 (May 31, 2026) |
Q4 FY26 (Feb 28, 2026) |
Q1 FY26 (May 31, 2025) |
| Assets Under Management ($ in thousands) |
1,126,334 |
1,109,134 |
968,318 |
| Net Asset Value ($ in thousands) |
378,455 |
396,156 |
396,369 |
| NAV per share ($) |
23.23 |
24.42 |
25.52 |
| Total Investment Income ($ in thousands) |
30,777 |
31,123 |
32,319 |
| Net Investment Income per share ($) |
0.47 |
0.48 |
0.66 |
| Earnings per share ($) |
(0.42) |
(0.16) |
0.91 |
| Dividends per share ($) |
0.75 |
1.00* |
0.75 |
| Return on Equity - last twelve months |
4.0% |
9.1% |
9.3% |
| Originations ($ in thousands) |
79,151 |
135,139 |
50,086 |
| Repayments ($ in thousands) |
48,415 |
34,020 |
64,330 |
*Includes special dividend.
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