SOURCE: The Bedford Report

The Bedford Report

October 28, 2011 08:16 ET

Investors Look for Larger Shareholder Return From BDCs This Earnings Season

The Bedford Report Provides Equity Research on American Capital Limited & Apollo Investment

NEW YORK, NY--(Marketwire - Oct 28, 2011) - This earnings season, investors will be feverishly watching Business Development Companies' (BDC) bottoms lines, to see if companies such as Prospect and Ares Capital will boost shareholder return. BDCs are well known for their generosity to shareholders -- either in the form of dividend payments or share repurchase. BDCs are usually taxed as regulated investment companies (RIC) under the Internal Revenue Code. As a pass-through tax structure, RICs must distribute at least 90 percent of taxable income as dividends to shareholders. The Bedford Report examines the outlook for companies in the Business Development Company (BDC) Industry and provides stock analysis on American Capital Ltd. (NASDAQ: ACAS) and Apollo Investment Corporation (NASDAQ: AINV). Access to the full company reports can be found at:

Several companies in the BDC sector have been raising capital and reducing leverage, giving them better operational flexibility moving forward through the year. The issuance of public debt has been one of the primary means by which the sector has sought to raise capital.

Apollo Investment Corporation's investment portfolio is principally in middle-market private companies. From time to time, the Company may also invest in public companies. The Company invests primarily in senior secured loans and mezzanine loans and equity in furtherance of its business plan. Apollo will report third quarter earnings on November 4th. Currently the company pays an annual dividend of $1.12 for a hefty yield of around 14.1 percent.

The Bedford Report releases investment research on the Business Development Company (BDC) Industry so investors can stay ahead of the crowd and make the best investment decisions to maximize their returns. Take a few minutes to register with us free at and get exclusive access to our numerous analyst reports and industry newsletters.

American Capital, both directly and through its asset management business, originates, underwrites and manages investments in middle market private equity, leveraged finance, real estate and structured products. The company currently fails to pay a dividend. However, last month announced the buyback of its $75 million common stock in open market since early August. Common stock of 9.1 million shares has been repurchased at an average price of $8.21 per share. American Capital foresees additional stock purchases or dividend payments by the end of December 2012 and announced the program for the same. According to the company's plan, if the price of American Capital's common stock trade at a premium to the net asset value of shares, then the company will opt for dividend payments.

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