Saratoga Investment Raises Quarterly Dividend
Saratoga Investment Corp. announced on Tuesday to increase quarterly dividend to $0.41 per share. Shareholders have option to receive payment of the dividend in cash, or receive shares of common stock
Saratoga Investment is a business development that provides customized financing solutions for middle market companies located in the United States. The company established itself as a solution-oriented lender which seeks to partner in crafting capital structure to pursue its partners' business plan. Saratoga focues on lower end of middle market, which comprise of US-based cash flow positive companies with annual revenues between $10 and $100 million, with EBITDA in excess of $2 million.
Prior to the announcement, Zacks Investment Research downgraded the company's shares rating. According to Vista Voice, the analysts downgraded the shares to "Hold" from "Buy" in its investors note on Saturday. The rating signaled the investors to wait for the dividend announcement on Tuesday.
On Tuesday, as Seeking Alpha reported, Saratoga declared a quarterly dividend of $0.41 per share for the quarter ended on February 29, 2016. The dividend is a 2.5% increase from prior $0.40.
Previously, the company paid $0.27 dividend per share for the quarter ended February 28, 2015, and $0.33 per share for the quarter ended May 31, 2015. In the next quarter ended August 31, 2015 it paid $0.36 per share, and a $0.40 per share for the quarter ended November 30, 2015. The company also paid special dividend of $1.00 per share in June 2015.
Chairman and Chief Executive Officer of Saratoga Investment Christian L. Oberbeck is pleased to announce the company to pay more dividend to its shareholders. In the midst of the challenges in the business development market, Saratoga manage to increase shareholders value.
"In light of the volatility and challenges facing the BDC market, we are very pleased to continue paying an increasing and healthy quarterly dividend," Mr. Oberbeck told PR Newswire.
"Our ability to over-earn our dividend results from the stable and growing income yield generated from our prudently increasing and high quality portfolio. During this past quarter, we have repurchased 37,920 shares demonstrating our commitment to building shareholder value while maintaining adequate capital to leverage market opportunities."
Saratoga had also exercised its share repurchase plan this quarter. The company announced in fiscal year 2015 to repurchase up to 200,000 shares of its common stock at prices below its net assets value. The New York-based company extended its open market repurchase plan in the last quarter to 400,000 shares through October 2016.
President and Chief Investment Officer at Saratoga Mike Grisius expressed his satisfaction with the announcement. He said, "Our financial performance rests on a new deal pipeline that remains productive despite market tightening. We enjoy strategic flexibility in how we source and deploy capital and feel well positioned to face current market conditions."
Saratoga Investment Corporation increased its dividend by 2.5%. The company declared a quarterly dividend of $0.41 per share on Tuesday.
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