Blue Owl Capital Corp (NYSE: OBDC)

Sector: Financial Services Industry: Asset Management CIK: 0001655888
Market Cap 3.38 Bn
P/B 0.57
P/E 8.59
P/S 5.25
ROIC (Qtr) 7.76
Div Yield % 6.12
Rev 1y % (Qtr) 11.58
Total Debt (Qtr) 9.53 Bn
Debt/Equity (Qtr) 1.25
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About

Blue Owl Capital Corp, also known by its stock symbol OBDC, operates in the specialty finance industry. The company's primary business is to generate current income and, to a lesser extent, capital appreciation by targeting investment opportunities with favorable risk-adjusted returns. Blue Owl Capital Corp was established in October 2

Investment thesis

Bull case

  • Strong operating cash flow of 1.36B provides 87.95x coverage of SG&A expenses 15.52M, showing efficient operational cost management.
  • Operating cash flow of 1.36B provides strong 100.79x coverage of operating expenses 13.54M, showing operational efficiency.
  • Strong free cash flow of 1.36B provides 87.95x coverage of SG&A expenses 15.52M, indicating efficient cost management.
  • Free cash flow of 1.36B provides solid 100.79x coverage of operating expenses 13.54M, showing operational efficiency.
  • Operating cash flow of 1.36B exceeds receivables of 130.56M by 10.45x, demonstrating excellent collection efficiency.

Bear case

  • Operating cash flow of 1.36B provides thin coverage of dividend payments of (727.33M) with a -1.88 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Free cash flow of 1.36B represents just -1.71x of debt issuance (800.34M), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Cash position of 321.30M provides only 0.57x coverage of interest expenses of 566.51M, indicating potential refinancing risks in a rising rate environment.
  • R&D investment of 0 represents just 0x of SG&A expenses of 15.52M, indicating potential underinvestment in innovation relative to administrative overhead.
  • Interest expense of 566.51M consumes 0.46x of operating earnings 1.24B, suggesting concerning debt service burden relative to operational performance.

Peer comparison

Companies in the Asset Management
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 BLK BlackRock, Inc. 199.59 Bn 85.40 21.98 15.04 Bn
2 BN BROOKFIELD Corp /ON/ 103.94 Bn 31.52 5.64 262.97 Bn
3 AMP Ameriprise Financial Inc 88.69 Bn 55.02 7.20 5.89 Bn
4 BX Blackstone Inc. 88.51 Bn 49.39 10.93 12.89 Bn
5 KKR KKR & Co. Inc. 55.86 Bn 28.33 13.23 53.12 Bn
6 STT State Street Corp 46.52 Bn 21.77 3.91 34.72 Bn
7 NTRS Northern Trust Corp 34.14 Bn 33.31 6.71 15.64 Bn
8 RJF Raymond James Financial Inc 32.89 Bn 37.63 4.14 5.10 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.27 0.94
EV to Cash from Ops. EV/CFO -1.45 41.10
EV to Debt EV to Debt 0.49 15.28
EV to EBIT EV/EBIT 9.00 23.47
EV to EBITDA EV/EBITDA 8.30 47.80
EV to Free Cash Flow [EV/FCF] EV/FCF -1.45 38.62
EV to Market Cap EV to Market Cap 1.39 7.81
EV to Revenue EV/Rev 7.31 27.38
Price to Book Value [P/B] P/B 0.57 2.34
Price to Earnings [P/E] P/E 8.59 11.81
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.91 4.66
Dividend Payout Ratio % Div Payout % (Qtr) 114.20 -5.56
Dividend per Basic Share Div per Share (Qtr) 1.61 1.73
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 60.30 49.83
Interest Coverage Int. cover (Qtr) 2.19 25.16
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex Growth (1y) % 0.00 -35.10
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -33.25 15.43
Dividend Growth (1y) % Div 1y % (Qtr) -6.94 1.65
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 13.08 -90.82
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 11.01 35.24
EBIT Growth (1y) % EBIT 1y % (Qtr) 12.15 -22.13
EBT Growth (1y) % EBT 1y % (Qtr) 4.55 -163.05
EPS Growth (1y) % EPS 1y % (Qtr) -12.42 -20.61
FCF Growth (1y) % FCF 1y % (Qtr) 965.08 220.21
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 10.82 -53.96
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.10 0.22
Cash Payout Ratio Cash Payout (Qtr) 0.53 0.36
Cash Ratio Cash Ratio 0.00 0.38
Current Ratio Current Ratio 0.00 0.86
Debt to Equity Ratio Debt/Equity (Qtr) 1.25 0.70
Interest Cover Ratio Int Coverage (Qtr) 2.19 25.16
Times Interest Earned Times Interest Earned (Qtr) 2.19 25.16
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 69.10 -114.76
EBIT Margin % EBIT Margin % (Qtr) 69.08 -127.24
EBT Margin % EBT Margin % (Qtr) 37.57 -150.97
Gross Margin % Gross Margin % (Qtr) 77.70 67.88
Net Profit Margin % Net Margin % (Qtr) 36.90 -148.68