Goldman Sachs BDC: Headed For Dividend Trouble
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Silicone Scrooge Insights402 FollowersFollow5ShareSavePlay(8min)CommentsSummaryGoldman Sachs BDC faces elevated dividend cut risk in 2026 due to high non-accruals, negative GAAP NII-to-distribution spread, and looming interest rate cuts.GSBD's 100% floating-rate, first-lien portfolio exposes it to the full downside from falling rates, while high repayments and persistent loan losses pressure book value.Dividend coverage has deteriorated, with GAAP NII under-covering payouts for three of the last four quarters, despite a revised dividend structure.I rate GSBD a Sell, given weakening coverage, high non-accruals, and an unattractive yield vs. peers trading at discounts to book value.Robert Way/iStock Editorial via Getty Images My Sell Thesis for Goldman Sachs BDC With interest rate cuts looming over the market as the year draws to a close, private credit businesses are dealing with increased odds of dividend cuts in 2026. ItThis article was written bySilicone Scrooge Insights402 FollowersFollowI’m a retail investor based in Sydney with three years of experience focusing on achieving financial independence through strategic investments in AI-driven companies. Although I don’t come from a traditional finance background, I’ve developed a strong passion for understanding how artificial intelligence is transforming the global economy. Over the past few years, I’ve become increasingly fascinated by the possibilities of AI—how it’s reshaping industries, driving innovation, and creating new investment frontiers. My portfolio is primarily centered around leading AI-related companies such as NVIDIA and others at the forefront of this technological revolution. I believe we’re only in the early stages of AI’s impact, and the coming decade will present remarkable opportunities for both retail and institutional investors. My goal is to continue learning, sharing insights, and building long-term wealth by investing in the technologies shaping our future.Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.