Why Is Blue Owl Capital Corporation (OBDC) Up 2.3% Since Last Earnings Report?

Core Viewpoint - Blue Owl Capital Corporation reported better-than-expected second-quarter earnings, driven by growing investment income and strong portfolio performance, while also announcing a merger with Blue Owl Capital Corporation III [2][3][9]. Financial Performance - The second-quarter 2024 earnings per share (EPS) was 48 cents, beating the Zacks Consensus Estimate by 1 cent, remaining flat year over year [2]. - Total investment income reached $396.8 million, a 0.6% increase year over year, and also exceeded the Zacks Consensus Estimate by 2% [2]. - Net investment income increased by 1.3% year over year to $189.1 million, surpassing estimates by 3.3% [4]. - Total expenses remained flat at $205.2 million, higher than the estimated $200.8 million, primarily due to increased interest expenses and management fees [5]. - Net income for the second quarter was $122.2 million, down from $195.6 million in the previous year [5]. Investment Commitments and Portfolio - New investment commitments totaled $3.3 billion across 25 new and 24 existing portfolio companies [4]. - As of June 30, 2024, Blue Owl Capital had investments in 212 portfolio companies with an aggregate fair value of $13.3 billion, averaging $62.9 million per investment [4]. Cash and Debt Position - Cash and restricted cash decreased to $380 million from $658.7 million at the end of 2023 [6]. - Total assets rose to $13.9 billion from $13.5 billion at the end of 2023, while debt increased to $7.4 billion from $7.1 billion [6]. Dividend and Share Repurchase - A third-quarter 2024 dividend of 37 cents per share was declared, with a supplemental dividend of 6 cents for the second quarter [8]. - A new share repurchase plan for 2024 was approved, allowing for up to $150 million in share buybacks, with no repurchases made in the second quarter [9]. Merger Agreement - Blue Owl Capital has agreed to merge with Blue Owl Capital Corporation III, with OBDC as the surviving entity, expected to enhance operational efficiency and scale while preserving credit quality [9]. Market Outlook - Estimates for Blue Owl Capital have trended upward, with a Zacks Rank of 3 (Hold), indicating expectations for an in-line return in the coming months [12].