SLR Investment Corp. (NASDAQ: SLRC)

Sector: Financial Services Industry: Asset Management CIK: 0001418076
Market Cap 816.26 Mn
P/B 0.83
P/E 10.69
P/S 3.56
ROIC (Qtr) 7.29
Div Yield % 11.90
Rev 1y % (Qtr) -4.65
Total Debt (Qtr) 1.14 Bn
Debt/Equity (Qtr) 1.15
Add ratio to table...

About

SLR Investment Corp., known by its ticker symbol SLRC, operates as a business development company (BDC) within the investment industry. The company's primary focus is to generate both current income and capital appreciation through debt and equity investments in leveraged middle-market companies. SLR Investment Corp.'s strategy involves investing primarily in senior secured loans, financing leases, and to a lesser extent, unsecured loans and equity securities. The company seeks to provide senior secured loans to leveraged companies in various industries...

Read more

Investment thesis

Bull case

  • Strong operating cash flow of 104.37M provides 10.56x coverage of SG&A expenses 9.88M, showing efficient operational cost management.
  • Strong free cash flow of 104.37M provides 10.56x coverage of SG&A expenses 9.88M, indicating efficient cost management.
  • Operating cash flow of 104.37M exceeds receivables of 15.93M by 6.55x, demonstrating excellent collection efficiency.
  • Tangible assets of 2.53B provide robust 158.82x coverage of receivables 15.93M, showing strong asset quality.

Bear case

  • Operating cash flow of 104.37M provides thin coverage of dividend payments of (89.47M) with a -1.17 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • R&D investment of 0 represents just 0x of SG&A expenses of 9.88M, indicating potential underinvestment in innovation relative to administrative overhead.
  • Interest expense of 67.45M consumes 0.43x of operating earnings 157.52M, suggesting concerning debt service burden relative to operational performance.
  • Other current assets of 0 provide weak coverage of payables of 395.22M, which is 0x, suggesting potential working capital stress in near term.

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 0.66 0.94
EV to Cash from Ops. EV/CFO -21.66 41.10
EV to Debt EV to Debt 1.46 15.28
EV to EBIT EV/EBIT 11.18 23.47
EV to EBITDA EV/EBITDA 10.12 47.80
EV to Free Cash Flow [EV/FCF] EV/FCF -21.66 38.62
EV to Market Cap EV to Market Cap 2.04 7.81
EV to Revenue EV/Rev 7.26 27.38
Price to Book Value [P/B] P/B 0.83 2.34
Price to Earnings [P/E] P/E 10.69 11.81
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 1.01 4.66
Dividend Payout Ratio % Div Payout % (Qtr) 98.80 -5.56
Dividend per Basic Share Div per Share (Qtr) 1.64 1.73
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 85.73 49.83
Interest Coverage Int. cover (Qtr) 2.34 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) 14.12 15.43
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 1.65
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -8.18 -90.82
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -8.54 35.24
EBIT Growth (1y) % EBIT 1y % (Qtr) -8.18 -22.13
EBT Growth (1y) % EBT 1y % (Qtr) -6.92 -163.05
EPS Growth (1y) % EPS 1y % (Qtr) -6.21 -20.61
FCF Growth (1y) % FCF 1y % (Qtr) -43.72 220.21
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -8.09 -53.96
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.09 0.22
Cash Payout Ratio Cash Payout (Qtr) 0.86 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) 1.15 0.70
Interest Cover Ratio Int Coverage (Qtr) 2.34 25.16
Times Interest Earned Times Interest Earned (Qtr) 2.34 25.16
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 71.70 -114.76
EBIT Margin % EBIT Margin % (Qtr) 71.71 -127.24
EBT Margin % EBT Margin % (Qtr) 41.00 -150.97
Gross Margin % Gross Margin % (Qtr) 75.80 67.88
Net Profit Margin % Net Margin % (Qtr) 41.00 -148.68