Company Overview
Oxford Square Capital Corp. operates as a business development company structured as a closed-end, non-diversified management investment company, focusing its capital on private equity and mezzanine strategies. The firm invests across both public and private companies, targeting secured and unsecured senior debt as well as subordinated debt instruments to generate returns. It functions within the Financial Services sector, specifically the Asset Management industry, where it leverages specialized investment expertise to manage capital for shareholders. With a market capitalization of $147.02M and annual revenue of $40.34M, the company represents a mid-sized entity in its niche. The market cap figure indicates a relatively modest scale compared to large-cap asset managers, suggesting a focus on targeted, specialized investments rather than broad market exposure. The revenue level reflects the scale of its debt investment portfolio, which supports its operational activities without indicating a large-scale diversified enterprise.
Financial Health
The company reported revenue of $40.34M over the trailing twelve months, yet it recorded a net income of $-18,731,068, while EBITDA figures are not available in the current data set. The significant gap between positive revenue and substantial negative net income reveals a cost structure where operating expenses, such as management fees and interest costs, have exceeded gross profits, resulting in a loss for the period. Despite the accounting loss, the company generated free cash flow of $10.06M, which indicates a degree of financial flexibility to fund operations or potential capital allocations independent of net income accruals. Margin analysis shows a gross margin of 100.0%, typical for asset management firms with minimal cost of goods sold, an operating margin of 80.0% suggesting efficient core operations, but a profit margin of -46.4% highlighting the impact of non-operating charges or interest expenses on overall profitability. The company holds cash of $51.93M against total debt of $151.63M, resulting in a debt-to-equity ratio of 104.28, which characterizes a highly leveraged balance sheet common in business development companies but requiring careful monitoring of refinancing needs. The current ratio stands at 5.56, indicating a robust short-term liquidity position where current assets significantly exceed current liabilities, providing a buffer against immediate obligations. Return on Equity is -12.2% and Return on Assets is 6.6%, metrics that reveal management effectiveness is currently constrained by the net loss impacting shareholder equity, while asset efficiency remains positive before equity dilution effects.
Valuation Assessment
Valuation metrics for Oxford Square Capital Corp. include a P/E Ratio (TTM) of N/A due to the negative earnings, while the forward P/E is 6.00, implying expectations of future profitability growth or a reversion to positive earnings to support the current price. The price-to-book ratio is 0.99, indicating that the stock trades at roughly par value relative to its book value, suggesting no significant market premium or discount for the underlying assets at this moment. The price-to-sales ratio is 3.64 and the EV/EBITDA is N/A, metrics that suggest the market is valuing the company primarily on its revenue generation and asset base rather than current earnings power or cash flow multiples. The 52-week high is $2.64 and the 52-week low is $1.56, and while the exact current price is not provided in the facts, the forward P/E of 6.00 suggests the market is pricing in future earnings potential rather than current performance. The beta value is 0.49, which indicates that the stock's price volatility is substantially lower than the broader market, offering a more stable price profile relative to the overall equity market movements.
Growth & Income
Revenue growth year-over-year is 1.9%, while earnings growth year-over-year is N/A due to the negative net income, implying that earnings are not currently growing in a traditional sense but rather reflecting a structural loss phase. For dividend payers, the company offers a dividend yield of 25.0% with a payout ratio of 466.7%, a metric that indicates the dividend is not sustainable based on current net income since the payout ratio exceeds 100%. The high payout ratio necessitates reliance on cash flow or asset sales to maintain dividend payments, as net income cannot support the declared distribution. The overall growth and income profile is characterized by low single-digit revenue expansion and a reliance on non-earnings sources to fund a high-yield dividend, creating a distinct risk-reward dynamic for income-focused investors.