Goldman Sachs BDC: Huge Discount To NAV, But I'm Not Buying The Fat 14% Yield

2025-12-12 14:00:59 ET

While Goldman Sachs BDC ( GSBD ) has not participated in the recovery seen across the BDC space since the First Brands Group and Tricolor collapses dented private credit sentiment, the BDC is paying out a fat and well-covered base dividend yield and maintains a supplemental distribution. GSBD's discount to net asset value ("NAV") has extended materially versus its year-ago level, with NAV coming in at $12.75 per share at the end of its fiscal 2025 third quarter. This was a sequential dip of 2.1%, around $0.31 per share, from the second quarter. The BDC currently swaps hands for $9.91 per share, a huge 22.27% discount to its third-quarter NAV, even as it declared a base quarterly cash dividend of $0.32 per share , kept unchanged from its prior distribution, and $1.28 per share annualized for a 12.9% dividend yield. There was also a $0.04 per share supplemental cash dividend paid. This would amount to an incremental 1.61% dividend yield if repeated through a full fiscal year. The aggregate dividend yield would be 14.5%....

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