Blue Owl Capital

OBDC

Market cap $6.58B

The recent sell-off has created rare value in two blue-chip, defensively positioned high-yield names: Golub Capital BDC and Blue Owl Capital. They both now trade at double-digit discounts to NAV with ~12% yields. Here's why I'm rating them strong buys despite near-term headwinds.

High yields are tempting, but often hide coming dividend cuts or price drops from distress. Rising interest rates can shift capital to bonds, eroding a high-yield stock's appeal, but we look like we're entering an easing cycle.

OBDC posts rising investment income and cash flow with strong dividends, but high debt and weak efficiency can temper its growth story.

NEW YORK , Oct. 1, 2025 /PRNewswire/ -- Blue Owl Capital Corporation (NYSE: OBDC) ("OBDC") today announced it will release its financial results for the third quarter ended September 30, 2025 on Wednesday, November 5, 2025 after market close. OBDC invites all interested persons to its webcast / conference call on Thursday, November 6, 2025 at 10:00 a.m.

AI disruption is happening faster than most expect, with trillions in CapEx reshaping industries and creating huge risks for income investors. BDCs thrive on high yields, but their heavy software exposure now faces AI-driven disruption that could upend portfolios and cash flows. I'm staying cautious, focusing on proven BDCs with strong diversification and lower disruption risk to balance income with resilience.

The Dividend Power strategy highlights 35 high-yield stocks, with 12 'safer' picks offering free cash flow yields above dividend yields and fair valuations. Top five 'safer' Dividend Power stocks for September are Carlyle Secured Lending (CGBD), Stellus Capital (SCM), Blue Owl Capital (OBDC), SLR Investment (SLRC), and Seven Hills Realty (SEVN). Analyst projections suggest the top ten Dividend Power stocks could deliver average net gains of 43.3% by September 2026, though risk and volatility vary.

Wall Street suits tend to avoid business development companies (BDCs). That's a mistake.

BDCs have outperformed over the past half-decade. However, macro and sector conditions are shifting rapidly. This could be the toughest environment BDCs have faced in years.

Steven Bavaria, from Inside the Income Factory, discusses credit assets like high-yield bonds, senior loans, and BDCs for stable, high-yield income, favoring closed-end funds for their resilience and discounts. Expense ratios for BDC ETFs like PBDC appear high due to accounting rules, but actual fund expenses are low—professional management adds only about 0.4%.

Dividend Harvesting Portfolio Week 233: $23,300 Allocated, $2,478.50 In Projected Dividends