we discuss ideas like this as they happen in more detail. All active investors are welcome to join on a free trial and ask any question in our chat room full of sophisticated traders and investors.We continue our series of hunting yield in the business development company ("BDC") sector with the following lines for Great Elm Capital Corporation ( GECC ) and its baby bonds. GECC was severely impacted by the First Brands fiasco, and thisArbitrage Trader, aka Denislav Iliev has been day trading for 15+ years a ...

we discuss ideas like this as they happen in more detail. All active investors are welcome to join on a free trial and ask any question in our chat room full of sophisticated traders and investors.We continue our series of hunting yield in the business development company ("BDC") sector with the following lines for Great Elm Capital Corporation ( GECC ) and its baby bonds. GECC was severely impacted byArbitrage Trader, aka Denislav Iliev has been day trading for 15+ years and leads a team of 40 analysts. Th ...

Great Elm Capital Corp. (NASDAQ:GECC) is included among the 15 Stocks with Highest Dividend to Invest in. Clear Street Maintains Buy on GECC, Lowers Price Target to $8.50 Photo by Annie Spratt on Unsplash O⁠n November 7, Clear Str‌eet analyst Mic‍key Schleien reduced the firm’s price‍ target⁠ on Great Elm Capital Corp. (NASDAQ:GECC) to‍ $8.50⁠ from⁠ $10 whil‌e maintaining⁠ a Buy rating on the shares. Schleien noted that the company experienced a “rough” Q3 with multiple⁠ cre‌dit issues and expects lower ...

Group 1 - The article does not provide any specific information or insights regarding a company or industry [1]

Financial Data and Key Metrics Changes - The company reported a net investment income (NII) of $2.4 million, or $0.20 per share, down from $5.9 million, or $0.51 per share, in the second quarter of 2025 [11][12] - Net asset value (NAV) per share decreased to $10.01 from $12.10, primarily due to losses associated with First Brands [9][12] - The asset coverage ratio was 168.2%, slightly down from 169.5% as of June 30 [12] Business Line Data and Key Metrics Changes - The CLO joint venture (JV) generated $1.5 million in the third quarter, a decline from $4.3 million in the second quarter [7][11] - The company received $4.3 million in distributions from the CLO JV in the fourth quarter to date, with expectations for further distributions [7][28] Market Data and Key Metrics Changes - The company experienced a significant adverse impact on NAV due to First Brands' bankruptcy, which affected NAV by approximately $16.5 million [4][11] - The investment in CW Opportunity 2 LP saw a decline in fair value, with CoreWeave common stock dropping approximately 16% in the quarter [9] Company Strategy and Development Direction - The company plans to focus on increasing allocations to first lien senior secured investments to enhance portfolio quality [13] - A $10 million share repurchase program has been approved by the board, alongside a $0.37 dividend for the fourth quarter [6][12] - The company aims to diversify its portfolio and reduce average position sizing as it deploys capital [6][9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to rebuild income and NAV, emphasizing a strong capital position and focus on risk management [6][10] - The company is taking a measured approach to new originations, prioritizing credit fundamentals and downside protection [17] - Management noted that the exposure to First Brands was too large and highlighted the importance of portfolio diversification moving forward [6][9] Other Important Information - The company has over $25 million in cash to deploy and $50 million available under its revolver, providing significant financial flexibility [17] - The company is actively working to monetize non-yielding equity investments to reinvest in cash-generating opportunities [15][17] Q&A Session Summary Question: Inquiry about CoreWeave capital distributions - Management confirmed that distributions received cover the cost basis of the investment, with future distributions expected to generate additional capital for reinvestment [23][24] Question: Clarification on the $20 million capital from non-yielding assets - Management indicated that the $20 million includes CoreWeave and other identified non-yielding assets expected to be harvested [25][26] Question: Discussion on the current investment pipeline - Management noted that while spreads in public markets are tight, they are focused on secured and income-generating opportunities, with a robust deal pipeline [27]

Financial Performance - Total Investment Income (TII) declined to $10.6 million in 3Q 2025 from $14.3 million in 2Q 2025[6, 12] - Net Investment Income (NII) was $2.4 million, or $0.20 per share in 3Q 2025, compared to $5.9 million, or $0.51 per share in 2Q 2025[6, 14] - Net assets were $140.1 million, or $10.01 per share, compared to $140.0 million, or $12.10 per share in 2Q 2025[6, 17] Capital Activity - The company issued approximately 2.4 million shares for net proceeds of approximately $27 million in the third quarter[6] - $13 million of net proceeds year-to-date through the at-the-market (ATM) equity program launched in May 2025[8] - GECC issued $50 million of 7.75% notes due 2030 in September 2025[8] Portfolio Composition - The portfolio's fair value is $325.1 million, with a net asset value of $140.1 million[11] - Debt investments have a weighted average current yield of 11.5%[11] - 66.4% of the portfolio is in debt investments, with a fair value of $215.8 million[25] Shareholder Returns - The Board approved maintaining the distribution for the quarter ending December 31, 2025, at a rate of $0.37 per share[6] - The distribution equates to a 19.8% annualized yield on the Company's closing market price on November 3, 2025, of $7.48[6, 7] - The distribution equates to a 14.8% annualized yield on the Company's September 30, 2025, NAV of $10.01 per share[6, 7]

Great Elm Capital (GECC) came out with quarterly earnings of $0.2 per share, missing the Zacks Consensus Estimate of $0.24 per share. This compares to earnings of $0.39 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -16.67%. A quarter ago, it was expected that this company would post earnings of $0.44 per share when it actually produced earnings of $0.51, delivering a surprise of +15.91%.Over the last four quarters, the compa ...

Investment Activity - The company generated total investments of $345.684 million for the year ended December 31, 2024, with dispositions amounting to $245.576 million[34]. - For the nine months ended September 30, 2025, the company acquired investments totaling $148.775 million and disposed of $127.474 million[36]. - The ending investment portfolio at fair value as of September 30, 2025, was $325.106 million, compared to $324.262 million at the end of 2024[37]. - The company formed a joint venture, CLO Formation JV, LLC, to invest primarily in subordinated note securities in CLOs[15]. - The company’s investment activity is influenced by factors such as the availability of capital for middle-market companies and the general economic environment[19]. Revenue and Income - The company’s primary revenue source is interest from debt investments, with additional revenue from dividends and capital gains[21]. - Total investment income for the three months ended September 30, 2025, was $10,642,000, a decrease from $11,727,000 in the same period of 2024, reflecting a decline of 9.3%[39]. - Interest income for the three months ended September 30, 2025, was $7,583,000, down from $8,121,000 in 2024, primarily due to a lower average coupon rate of 10.8% on approximately $224.1 million of principal[40]. - Dividend income decreased to $2,060,000 for the three months ended September 30, 2025, compared to $3,586,000 in 2024, a decline of 42.5%[41]. - Other income increased for the three months ended September 30, 2025, primarily due to non-refundable carry fees and early repayment fees[42]. Expenses and Fees - Total expenses for the three months ended September 30, 2025, were $7,971,000, an increase from $7,580,000 in the same period of 2024, representing a rise of 5.2%[44]. - Interest expense increased to $5,485,000 for the three months ended September 30, 2025, compared to $4,210,000 in 2024, reflecting a rise of 30.3% due to new note issuances[48]. - Management fees rose to $1,253,000 for the three months ended September 30, 2025, compared to $1,201,000 in 2024, an increase of 4.3% driven by portfolio growth[45]. - The company did not accrue any incentive fees for the three months ended September 30, 2025, due to decreased investment income and increased hurdles[46]. Gains and Losses - For the three months ended September 30, 2025, the net realized gain was $6.2 million, or $0.50 per share, compared to a net realized gain of $226,000, or $0.02 per share for the same period in 2024[49]. - The gross realized gain for the nine months ended September 30, 2025 was $7.4 million, or $0.62 per share, compared to $3.4 million, or $0.36 per share for the same period in 2024[49]. - The net change in unrealized depreciation for the three months ended September 30, 2025 was $(30.6) million, or $(2.48) per share, compared to $(821,000), or $(0.08) per share for the same period in 2024[52]. - Unrealized depreciation for the nine months ended September 30, 2025 was primarily driven by losses of approximately $17.0 million on investments in First Brands, Nice-Pak, and CLO JV[53]. Financial Position and Liquidity - As of September 30, 2025, the total fair value of the investment portfolio was $413,804,000, an increase from $332,710,000 as of December 31, 2024, representing a growth of 24.4%[38]. - The company believes it has sufficient liquidity to meet its short-term and long-term obligations for at least the next 12 months[61]. - Total contractual obligations as of September 30, 2025 amounted to $205.4 million, with $57.5 million due within one year[62]. - The company had approximately $46,000 in unfunded commitments to provide financing to certain portfolio companies as of September 30, 2025[58]. - The company’s revolving line of credit was increased to up to $50 million, with a potential increase to $90 million, and no borrowings were outstanding under the revolving line as of September 30, 2025[68][69]. Debt Instruments - As of September 30, 2025, the company had approximately $88.7 million in short-term investments and $220.7 million in debt instruments across 49 companies[57]. - The aggregate principal balance of the GECCO Notes outstanding was $57.5 million, with an interest rate of 5.875% due in 2026[71]. - The aggregate principal balance of the GECCI Notes outstanding as of September 30, 2025 was $56.5 million, with an interest rate of 8.50% due in 2029[73]. - The aggregate principal balance of the GECCH Notes outstanding as of September 30, 2025 was $41.4 million, with an interest rate of 8.125% due in 2029[74]. - The aggregate principal balance of the GECCG Notes outstanding as of September 30, 2025 was $50.0 million, with an interest rate of 7.75% due in 2030[75]. - The company redeemed all of the GECCM Notes on October 12, 2024, at 100% of the principal amount plus accrued interest[70]. Stock and Shareholder Actions - The last reported closing price for the company's common stock on October 30, 2025, was $7.64 per share[81]. - The company declared a distribution of $0.37 per share for the quarter ending December 31, 2025, payable in cash[84]. - The company authorized a new share repurchase program to repurchase up to $10 million of its outstanding common shares[86]. - Approximately $153.9 million in principal amount of the company's debt investments bore interest at variable rates as of September 30, 2025[87].

Core Insights - Great Elm Capital Corp. (GECC) reported a decline in net asset value (NAV) per share from $12.10 to $10.01, primarily due to losses on First Brands investments [2][4] - The company maintained a quarterly dividend of $0.37 per share, reflecting a 19.8% annualized yield based on the closing price of $7.48 on November 3, 2025 [4][16] - GECC raised approximately $27 million in equity and refinanced its highest cost debt, resulting in lower borrowing costs and improved balance sheet strength [2][4] Financial Performance - Total investment income (TII) for Q3 2025 was $10.6 million, down from $14.3 million in Q2 2025, impacted by lower cash distributions from CLO investments [4][12] - Net investment income (NII) for Q3 2025 was $2.4 million ($0.20 per share), a decrease from $5.9 million ($0.51 per share) in Q2 2025, affected by elevated interest expenses and lower TII [4][12] - The company experienced net realized and unrealized losses of approximately $24.4 million ($1.98 per share) in Q3 2025 [12][29] Capital and Investment Activity - As of September 30, 2025, GECC held total investments valued at $325.1 million, with a significant portion in corporate credit and CLO investments [8][10] - The company utilized its at-the-market program to issue 1.1 million shares for net proceeds of approximately $13 million and completed a private placement for $14 million [8] - GECC's asset coverage ratio was 168.2% as of September 30, 2025, slightly down from 169.5% in the previous quarter [8] Shareholder Returns and Repurchase Program - The Board of Directors approved a quarterly cash distribution of $0.37 per share for Q4 2025, payable on December 31, 2025 [15] - A new share repurchase program was authorized, allowing the company to repurchase up to $10 million of its outstanding common shares [17]

Core Points - Great Elm Capital Corp. (GECC) will release its financial results for Q3 2025 on November 4, 2025, after market close [1] - A conference call to discuss the results is scheduled for November 5, 2025, at 8:30 a.m. ET [1] Company Overview - GECC is an externally managed business development company focused on generating current income and capital appreciation through investments in debt and income-generating equity securities, including specialty finance businesses and CLOs [4]