Main Street Capital (MAIN) is considered by many to be the the best of breed for Business Development Companies (BDCs).
Main Street Capital provides long term debt to middle market cap companies. According to a recent press release:
” Main Street’s portfolio investments are typically made to support management buyouts, recapitalizations, growth financings, refinancings and acquisitions of companies that operate in diverse industry sectors. Main Street seeks to partner with entrepreneurs, business owners and management teams and generally provides “one stop” financing alternatives within its lower middle market portfolio. Main Street’s lower middle market companies generally have annual revenues between $10 million and $150 million. Main Street’s middle market debt investments are made in businesses that are generally larger in size than its lower middle market portfolio companies.”
Main is a Monthly Dividend payer ( current Dividend is 0.185 per share) or on an annual basis $2.22 per share. In addition it pays a Special Dividend twice a year in June and December of 0.27 cents per share.
Initial Public Offering (IPO) was October 2007 @ $15.00 per share – Since that time Main has paid ($20.54 per share in cumulative Dividends)
Main Street Capital has been in my own portfolio for about two years now and quite frankly I wish I had gotten into it much sooner and at a much higher share count than I initially did. I continue to hold the stock and Drip the dividends. At around forty dollars per share at the time of this writing I find it just a little pricey but of course that’s the case with almost every desirable company. If I were initiating a position today I would recommend buying in slowly on any dips.
Some have been predicting with BDCs such as Main facing stiffer competition from banks that BDCs may have to cut their “special dividends”in the future but frankly that is not something I see happening any time soon. As a Dividend Income Investor I don’t make decisions based on what possibly happen but rather what is currently happening. If and when things begin to change – well I will deal with that when the time comes but right now I am enjoying collecting the great dividends that Main Street Capital is generating for my portfolio.
There may be better investments out there but you will have a very hard time finding them!
I especially enjoy the “special dividend” each December. It feels like they are sending me a Christmas present of cash !
For More Information visit Main Street Capital’s Website
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