Saratoga Investment Corporation (SAR) is a BDC with a small, but very enthusiastic, following. The company is consistently one of the top performers in its industry, with annual shareholder returns of more than 20% for many years, strong dividend yields, and even stronger dividend growth. Due to this, most analysts covering the company are generally bullish about its prospects, including myself. Nevertheless, there is one author who is quite bearish about the company, due to concerns about shareholder dilution and dividend coverage ratios.
In this article, I'll be focusing on these two concerns