Saratoga Investment Corp. (SAR)
For informational purposes only. Not financial advice. Analysis by Sedat ANAK, Founder & Editor-in-Chief | AI-powered analysis. Data sourced from SEC filings and institutional-grade financial providers. Editorially reviewed. Not financial advice.
Saratoga Investment Corp. (SAR) trades at $21.46 with AI Score 34/100 (Grade D). Saratoga Investment Corp. is a business development company (BDC) focused on providing financing solutions to lower middle market companies. Market cap: $349.11M, Sector: Financial services.
Price live · AI analysis from May 9, 2026SAR stock analysis for 2026: Analysts have set a consensus price target of $23.40 for Saratoga Investment Corp., suggesting 9.0% upside from the current price of $21.46. The AI MoonshotScore is 34/100, indicating a bearish outlook. Key factors: analyst coverage, AI-driven quantitative scoring.
SAR: 3/5 perspectives are bearish. Dominant signal: Seth Klarman bearish.
How is this calculated? →Saratoga Investment Corp. (SAR) Financial Services Profile
Saratoga Investment Corp. is a BDC specializing in debt and equity investments within lower middle market companies, primarily in the United States. With a focus on leveraged buyouts and growth financings, Saratoga offers tailored financial solutions, distinguishing itself through a high dividend yield and a diversified investment approach across various sectors.
What Is the Investment Thesis for SAR?
Saratoga Investment Corp. presents a compelling investment case driven by its focus on the underserved lower middle market, where financing options are often limited. The company's high dividend yield of 14.67% offers an attractive income stream for investors. With a P/E ratio of 9.6 and a profit margin of 27.8%, Saratoga demonstrates solid profitability and efficient operations. Growth catalysts include the continued expansion of its investment portfolio and strategic deployment of capital in high-growth sectors. Key value drivers include the firm's ability to generate consistent returns through its debt and equity investments and its expertise in structuring customized financing solutions. Potential risks include economic downturns impacting the performance of its portfolio companies and increased competition from other BDCs. Monitoring the company's asset quality and its ability to maintain its dividend payout ratio is crucial for investors.
Based on FMP financials and quantitative analysis
SAR Key Highlights
- Market capitalization of $349.11M indicates a moderate-sized player in the asset management industry.
- P/E ratio of 9.6 suggests the company's stock is reasonably valued compared to its earnings.
- Profit margin of 27.8% demonstrates strong profitability and efficient cost management.
- Gross margin of 75.5% highlights the company's ability to generate significant revenue from its investments.
- Dividend yield of 14.67% provides a substantial income stream for investors, reflecting the company's commitment to returning value to shareholders.
Who Are SAR's Competitors?
SAR is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.
| Company | Price | Change | Market Cap | AI Score |
|---|---|---|---|---|
| GBDC Golub Capital BDC, Inc. | $12.89 | -0.73% | $3.36B | 84 |
| NXDT NexPoint Diversified Real Estate Trust | $5.53 | +3.08% | $285.77M | 73 |
| GENB Generate Biomedicines, Inc. | $17.03 | -2.18% | $2.18B | 72 |
| SII Sprott Inc. | $118.11 | +2.72% | $3.05B | 71 |
| IDDTF AB Industrivärden (publ) | $59.80 | +74.60% | $25.83B | 70 |
| ARES Ares Management Corporation | $121.81 | +4.20% | $40.01B | 62 |
| JHG Janus Henderson Group plc | $51.95 | -0.04% | $8.00B | 62 |
| TRNGF The Trendlines Group Ltd. | $0.03 | +2.95% | $28.87M | 62 |
AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance
What Are SAR's Key Strengths?
- High dividend yield attracts income-seeking investors.
- Strong profit margin indicates efficient operations.
- Focus on the underserved lower middle market.
- Diversified investment portfolio across various sectors.
What Are SAR's Weaknesses?
- Relatively small market capitalization compared to larger BDCs.
- Dependence on the performance of its portfolio companies.
- Exposure to economic cycles and interest rate fluctuations.
- Managing 0 employees
What Could Drive SAR Stock Higher?
- Continued deployment of capital into new and existing portfolio companies.
- Strategic partnerships and co-investment opportunities expanding investment reach.
- Potential for increased fee income through advisory services to portfolio companies.
- Capitalizing on market dislocations to acquire assets at attractive valuations.
What Are the Key Risks for SAR?
- Financial-distress signal — its Altman Z-Score of 0.38 sits in the distress zone (elevated bankruptcy risk).
- Increased competition from other BDCs and private credit funds.
- Economic downturns impacting the performance of portfolio companies.
- Regulatory changes affecting the BDC industry.
- Interest rate increases reducing the value of debt investments.
What Are the Growth Opportunities for SAR?
- Expanding investment portfolio: Saratoga can grow by strategically deploying capital into new and existing portfolio companies. The lower middle market presents a significant opportunity, with numerous businesses seeking tailored financing solutions. By increasing its investment volume and diversifying its portfolio across various sectors, Saratoga can enhance its revenue streams and reduce concentration risk. This growth strategy is contingent on effective deal sourcing, due diligence, and portfolio management capabilities. The timeline for realizing this growth is ongoing, with continuous efforts to identify and execute new investment opportunities.
- Strategic partnerships and co-investments: Collaborating with other financial institutions and private equity firms can provide Saratoga with access to larger deals and specialized expertise. By forming strategic partnerships, Saratoga can participate in co-investment opportunities, expanding its reach and diversifying its investment portfolio. These partnerships can also provide access to valuable industry insights and networks, enhancing the firm's ability to identify and evaluate potential investment opportunities. The timeline for establishing and leveraging these partnerships is ongoing, with continuous efforts to build and maintain relationships with key industry players.
- Increasing fee income through advisory services: Saratoga can leverage its expertise in financing and operations to offer advisory services to its portfolio companies. By providing strategic guidance and operational support, Saratoga can generate additional fee income and enhance the value of its investments. These services can include financial planning, operational improvements, and strategic planning. The timeline for developing and implementing these advisory services is ongoing, with continuous efforts to expand the firm's capabilities and service offerings.
- Capitalizing on market dislocations: Economic downturns and market volatility can create opportunities for Saratoga to acquire assets at attractive valuations. By maintaining a flexible investment approach and a strong balance sheet, Saratoga can capitalize on market dislocations and generate superior returns. These opportunities may include distressed debt investments, recapitalizations, and opportunistic acquisitions. The timeline for capitalizing on market dislocations is event-driven, with opportunities arising during periods of economic uncertainty and market volatility.
- Leveraging technology to enhance efficiency: Investing in technology can improve Saratoga's operational efficiency and enhance its ability to source, evaluate, and manage investments. By implementing advanced analytics and data management systems, Saratoga can streamline its processes and make more informed investment decisions. These technologies can also improve communication and collaboration with portfolio companies, enhancing the firm's ability to monitor and support their performance. The timeline for implementing these technological enhancements is ongoing, with continuous efforts to adopt and integrate new technologies into the firm's operations.
What Opportunities Does SAR Have?
- Expanding investment portfolio through strategic capital deployment.
- Forming strategic partnerships and co-investment opportunities.
- Capitalizing on market dislocations and distressed debt investments.
- Increasing fee income through advisory services.
What Threats Does SAR Face?
- Increased competition from other BDCs and private credit funds.
- Economic downturns impacting the performance of portfolio companies.
- Regulatory changes affecting the BDC industry.
- Interest rate increases reducing the value of debt investments.
What Are SAR's Competitive Advantages?
- Expertise in structuring customized financing solutions for lower middle market companies.
- Established relationships with portfolio companies and industry partners.
- Diversified investment portfolio across various sectors.
- Strong track record of generating consistent returns.
What Does SAR Do?
Saratoga Investment Corp., formerly known as GSC Investment Corp., is a business development company (BDC) established to provide customized financing solutions to lower middle market companies. The firm specializes in leveraged and management buyouts, acquisition financings, growth financings, recapitalization, debt refinancing, and transitional financing transactions. Saratoga's investment strategy involves structuring investments as debt and equity, utilizing first and second lien loans, mezzanine debt, co-investments, select high yield bonds, senior secured bonds, unsecured bonds, and preferred and common equity. Founded with the aim of filling a critical financing gap for smaller businesses, Saratoga targets companies with EBITDA ranging from $2 million to $50 million and revenues between $8 million and $250 million. The firm seeks to invest between $5 million and $50 million per transaction, often taking a majority stake in the companies it supports. Saratoga's investment approach includes direct lending and participation in loan syndicates, offering flexibility and diversification. Saratoga's portfolio spans various sectors, including aerospace, automotive aftermarket and services, business products and services, consumer products and services, education, environmental services, industrial services, financial services, food and beverage, healthcare products and services, logistics, distribution, manufacturing, restaurants services, food services, software services, technology services, specialty chemical, media and telecommunications. Headquartered in New York, with an additional office in Florham Park, New Jersey, Saratoga Investment Corp. continues to focus on supporting the growth and development of U.S.-based lower middle market businesses.
What Products and Services Does SAR Offer?
- Provides leveraged and management buyout financing to lower middle market companies.
- Offers acquisition financing to support companies in their growth strategies.
- Structures growth financing for businesses looking to expand their operations.
- Facilitates recapitalization transactions to optimize companies' capital structures.
- Provides debt refinancing solutions to improve companies' financial flexibility.
- Engages in transitional financing to support companies through periods of change.
- Invests in debt and equity through various instruments, including first and second lien loans, mezzanine debt, and preferred and common equity.
How Does SAR Make Money?
- Generates income through interest payments on debt investments.
- Realizes capital gains from equity investments.
- Collects fees from structuring and managing financing transactions.
- Benefits from the appreciation of its portfolio companies' value.
What Industry Does SAR Operate In?
Saratoga Investment Corp. operates within the asset management industry, specifically focusing on business development companies (BDCs). The BDC sector is characterized by firms that provide financing to small and medium-sized businesses, often filling a gap left by traditional lenders. The industry is influenced by economic cycles, interest rate environments, and regulatory changes. Saratoga competes with other BDCs like Golub Capital BDC, Inc. (GBDC), as well as private credit funds and traditional lenders. The market for lower middle market financing is substantial, with ongoing demand for capital to support growth, acquisitions, and recapitalizations.
Who Are SAR's Key Customers?
- Lower middle market companies seeking financing for buyouts, acquisitions, and growth.
- Companies in sectors such as aerospace, automotive, business services, and healthcare.
- Businesses with EBITDA between $2 million and $50 million and revenues between $8 million and $250 million.
Company Profile
Saratoga Investment Corp. operates in the Asset Management industry within the Financial Services sector. It is headquartered in New York City, US. The company is led by CEO Christian Long Oberbeck. SAR has traded publicly since 2007.
F-Score 4/9Financial Health
Saratoga Investment Corp.'s Piotroski F-Score is 4/9, a 9-point checklist of profitability, leverage and efficiency — a middling fundamental profile. Its Altman Z-Score of 0.38 places it in the distress zone, a signal of elevated financial risk.
ROE 9%Key Financial Metrics
Return on equity for Saratoga Investment Corp. stands at 9.1%, a gauge of how efficiently it converts shareholder capital into profit. Return on assets is 3.2%, showing how much profit it generates from its asset base. SAR trades at a trailing price-to-earnings ratio of 9.59, below the Financial Services sector average of ~18x. Its free cash flow yield is -24.2%, a gauge of the cash the business throws off relative to its market value. A current ratio of 0.36 means current liabilities exceed short-term assets, a liquidity point worth watching. Its earnings yield is 10.3%, the inverse of the P/E and a quick read on earnings relative to price.
SAR Valuation & Market Position
With a $349.11M market cap, Saratoga Investment Corp. sits in the small-cap segment of the market. Relative to its peer group, SAR's quantitative score of 34/100 is below the peer average of 74/100.
FY2026 estForward Outlook
Wall Street analysts project Saratoga Investment Corp. revenue of about $125.4M for fiscal 2026, with EPS near $2.48. The estimate reflects 5 contributing analysts.
SAR Financials
Fundamental Snapshot
Based on FMP financials and quantitative analysis · FY 2026
Bull Case vs Bear Case
Bull Case
- Saratoga's recent insider buying signals confidence from those who know the company best. Think of it like Elon Musk buying more Tesla stock – it sends a strong message.
- Community sentiment suggests a growing belief in Saratoga's long-term strategy, indicating a positive shift in market perception. It's similar to how early positive sentiment fueled Amazon's growth.
- Bullish community views highlight Saratoga's potential for consistent dividend payouts, attracting income-focused investors. This is akin to the appeal of stable dividend stocks during uncertain times.
- The market seems to be recognizing Saratoga's niche in providing capital to lower middle market companies, a segment often overlooked by larger firms.
Bear Case
- Recent insider selling, even if small, can raise concerns about the short-term outlook. Reminds me of when key executives sold Lehman Brothers stock before the 2008 crash (though not comparable in scale).
- Bearish community views point to concerns about the potential impact of rising interest rates on Saratoga's portfolio companies. This is similar to how rate hikes impacted REITs in the past.
- Market perception suggests some skepticism about Saratoga's ability to maintain its current dividend yield in the face of economic headwinds.
- There's a lingering worry within the community that Saratoga’s focus on smaller companies makes it vulnerable during economic downturns, similar to how small businesses suffered disproportionately during the COVID-19 pandemic.
AI-generated arguments based on insider flow, news sentiment and technicals — not financial advice · March 2026
SAR Latest News
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Adamera Adopts Semi-Annual Financial Reporting
thenewswire.com · May 14, 2026
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Earnings Scheduled For May 5, 2026
benzinga · May 5, 2026
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Stocks That Hit 52-Week Highs On Friday
· Aug 27, 2021
SAR Analyst Consensus
Consensus Rating
Aggregated Buy/Hold/Sell recommendations from Benzinga, Yahoo Finance, and Finnhub for SAR.
Price Targets
Consensus target: $23.40
SAR MoonshotScore
What does this score mean?
The MoonshotScore rates SAR's growth potential on a scale of 0-100 across multiple factors including innovation, market disruption, financial health, and momentum.
Leadership: Christian Long Oberbeck
Managing Director and CEO
Christian Long Oberbeck serves as the Managing Director and CEO of Saratoga Investment Corp. His career spans various roles in finance and investment management. Oberbeck has extensive experience in leveraged finance, private equity, and restructuring. Prior to joining Saratoga, he held positions at leading financial institutions, where he focused on originating, structuring, and managing investments in middle market companies. His background includes a strong understanding of credit analysis, portfolio management, and corporate strategy. Oberbeck's leadership is characterized by a focus on disciplined investment practices and value creation.
Track Record: Under Christian Long Oberbeck's leadership, Saratoga Investment Corp. has focused on expanding its investment portfolio and enhancing its operational efficiency. Key achievements include strategic capital deployment in high-growth sectors and the maintenance of a strong dividend payout ratio. Oberbeck has overseen the diversification of the company's investment portfolio and the implementation of risk management strategies. His tenure has been marked by a commitment to generating consistent returns for shareholders and supporting the growth of lower middle market businesses.
SAR Financial Services Stock FAQ
What does Saratoga Investment Corp. do?
Saratoga Investment Corp. is a business development company (BDC) that provides financing solutions to lower middle market companies. The firm invests in debt and equity instruments, including first and second lien loans, mezzanine debt, and preferred and common equity. Saratoga's primary goal is to support the growth and development of these companies by providing them with the capital they need to expand their operations, make acquisitions, or recapitalize their balance sheets. The firm generates revenue through interest income, capital gains, and fees from its investment activities.
What do analysts say about SAR stock?
Analyst coverage of Saratoga Investment Corp. typically focuses on the company's ability to generate consistent returns and maintain its high dividend yield. Key valuation metrics include the company's P/E ratio, price-to-book ratio, and dividend payout ratio. Analysts also consider the company's asset quality, portfolio diversification, and management's ability to navigate economic cycles. The consensus view is often influenced by the company's financial performance, strategic initiatives, and overall market conditions. Investors should conduct their own due diligence and consider their individual investment objectives before making any investment decisions.
What are the main risks for SAR?
Saratoga Investment Corp. faces several risks inherent to its business model and the broader economic environment. One of the primary risks is the potential for economic downturns to negatively impact the performance of its portfolio companies. Credit risk is also a significant concern, as the company's investments in debt instruments are subject to the risk of default. Interest rate fluctuations can affect the value of its debt investments and its borrowing costs. Increased competition from other BDCs and private credit funds could also put pressure on the company's margins. Effective risk management and portfolio diversification are crucial for mitigating these risks.
How does Saratoga Investment Corp. make money in financial services?
Saratoga Investment Corp. generates revenue primarily through interest income earned on its debt investments in lower middle market companies. The firm also earns capital gains from the appreciation and sale of its equity investments. Additionally, Saratoga collects fees for structuring and managing financing transactions. A significant portion of its revenue is derived from the interest payments on its portfolio of loans, which are typically structured with fixed or floating interest rates. The company's ability to generate consistent returns depends on its ability to effectively manage its portfolio and minimize credit losses.
How sensitive is SAR to interest rate changes?
Saratoga Investment Corp.'s net interest margin is sensitive to changes in interest rates. The company's debt investments typically have floating interest rates, which means that its interest income can increase as interest rates rise. However, its borrowing costs can also increase, which could offset some of the benefits of higher interest income. The company's sensitivity to interest rate changes depends on the composition of its portfolio and its hedging strategies. Monitoring the company's net interest margin and its ability to manage its interest rate risk is crucial for investors.
What are the key factors to evaluate for SAR?
Saratoga Investment Corp. (SAR) holds an AI score of 34/100 (low). P/E: 9.6x vs the S&P 500's ~20-25x. Analysts target $23.40 (+9%). Not financial advice.
How frequently does SAR data refresh on this page?
SAR prices update in real time during U.S. market hours. Fundamentals refresh after quarterly filings; analyst ratings and AI insights update daily; news is aggregated continuously.
What has driven SAR's recent stock price performance?
Saratoga Investment Corp. (SAR) moves on earnings results, analyst revisions, sector rotation, and market sentiment. Notable catalyst: High dividend yield attracts income-seeking investors. See the News tab for the latest drivers. Past performance does not predict future results.
Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.
Official Resources
Data provided for informational purposes only.
- The information provided is based on available data and management commentary.
- Future performance is subject to various risks and uncertainties.