The dividend cut signals management's view that current earnings power cannot sustain the prior $0.40 payout, despite $0.70/share spillover income. NAV erosion from credit spread widening is a headwind for the BDC sector. Watch for further spread deterioration in Q2 and whether the new $0.35 dividend is sustainable against the $0.36 NII run rate.
Price Chart
Executive Summary
CGBD reported Q1 2026 NII of $0.36 per share, in line with the prior quarter and slightly above consensus, but NAV per share fell 2.3% to $15.89 driven by $29.4M in net realized/unrealized losses from widening credit spreads. The quarterly dividend was cut to $0.35 from $0.40, and total investment income declined 4.2% QoQ to $64.1M, reflecting lower interest income and portfolio shrinkage from sales to the Credit Fund.
Key Financial Metrics
Key Facts
- Q1 2026 NII of $0.36 per share vs $0.33 in Q4 2025 and $0.35 consensus (2.9% beat vs consensus)
- NAV per share fell 2.3% to $15.89 from $16.26, driven by $29.4M net realized/unrealized losses from widening spreads
- Quarterly dividend cut to $0.35 from $0.40 (12.5% reduction), annualized yield drops to ~12.8% from ~14.6%
- Total investment income declined 4.2% QoQ to $64.1M from $66.9M, driven by lower interest income ($56.2M vs $60.7M)
- Portfolio fair value decreased 7.6% to $2.28B from $2.46B, primarily due to $153M in sales to Credit Fund
- Non-accrual investments improved to 0.9% of fair value from 1.2% in Q4 2025
- Spillover income estimated at $0.70 per share, down from $0.74 in Q4 2025
- Credit Fund annualized dividend yield to CGBD remained at 15.3%; SCP yield 10.7%
- Share repurchases of $18.5M in Q1 at 26% discount to NAV, plus $8.8M post-quarter
Financial Impact
Dividend cut of $0.05/share quarterly ($0.20 annualized) represents ~$14M annual cash savings; NAV decline of $0.37/share represents ~$26M in equity value destruction
Risk Factors
- Further credit spread widening could accelerate NAV decline and pressure NII
- Dividend cut may trigger income-focused investor rotation out of the stock
- Portfolio shrinkage from Credit Fund sales reduces interest income base
- Leverage remains elevated at 1.25x debt-to-equity, limiting financial flexibility
Market Snapshot
Documents Analyzed
This report is based on 7 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0001544206-26-000032 |
| Document: csl-20260511.htm | 0001544206-26-000032 |
| Document: cgbd_2026331xxex991earning.htm | 0001544206-26-000032 |
| Document: 0001544206-26-000032-index-headers.html | 0001544206-26-000032 |
| Document: 0001544206-26-000032-index.html | 0001544206-26-000032 |
| Document: 0001544206-26-000032.txt | 0001544206-26-000032 |
| 8-K Data (Synthetic) | 0001544206-26-000032 |
Track record builds as more directional reports settle.
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 16, 2026 10d ago | Press Release | $10.25 | awaiting T+60 | — | $10.44 (+1.80%) |
Oct 16, 2026 10d ago | 8-K | $10.25 | awaiting T+60 | — | $10.44 (+1.80%) |
Aug 6, 2026 11w ago | 8-K | $11.02 | awaiting T+60 | — | $10.44 (−5.31%) |
Jul 15, 2026 14w ago | 8-K | $10.70 $10.42 | ▼ −2.62% | ▼ −6.33% | $10.44 (−2.48%) |
May 11, 2026 24w ago | 8-K | $11.38 $10.28 | ▲ +9.67% | ▲ +14.06% | $10.44 (+8.30%) |
May 11, 2026 24w ago | Press Release | $11.38 $10.28 | ▼ −9.67% | ▼ −14.06% | $10.44 (−8.30%) |
Apr 15, 2026 27w ago | Press Release | $11.57 $10.48 | ▼ −9.42% | ▼ −16.47% | $10.44 (−9.81%) |
Apr 15, 2026 27w ago | 8-K | $11.57 $10.48 | ▼ −9.42% | ▼ −16.47% | $10.44 (−9.81%) |
Mar 4, 2026 33w ago | Insider Cluster | $10.82 $10.92 | ▲ +0.90% | ▼ −9.19% | $10.44 (−3.58%) |
Mar 4, 2026 33w ago | Insider Cluster | $10.82 $10.92 | ▲ +0.90% | ▼ −9.19% | $10.44 (−3.58%) |
US Market Status
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