Saratoga Investment Corp. Announces Fiscal First Quarter 2027 Financial Results
Saratoga Investment Corp. (NYSE:SAR) reported fiscal Q1 2027 results ended May 31, 2026. AUM rose 1.6% to $1.126B with net originations of $31M. NAV fell to $378.5M (NAV/share $23.23). Adjusted NII was $0.47/share vs $0.53 last quarter; EPS was $(0.42). Dividends were $0.75/share. Non-accruals were 0.0% of fair value and 1.2% of cost.
How this was made
The 30-second read
Why it matters
The release provides fresh, decision-relevant datapoints: sequential NAV per share decline, adjusted NII per share reduction, and specific non-accrual/write-off items that inform near-term risk and valuation for SAR.
Market read
Traders can reassess SAR’s dividend coverage trajectory and credit-risk trajectory using the disclosed NAV/NII changes and the named non-accrual/write-off items.
What to watch
The company notes core fair value remains within 0.2% of cost and credit quality is still largely in its highest internal category (98.3%); traders may over-focus on a few marked-down equity/credits (Pepper Palace, Exigo) rather than portfolio-level credit metrics.
Background
Saratoga Investment is a business development company (BDC) focused on private credit; the quarter is framed as occurring amid sector-wide pressure from rates/spreads and rising defaults.
Ticker impact
Saratoga Investment reported fiscal Q1 2027 results with NAV per share down to $23.23 and adjusted NII per share falling to $0.47.
Near-term downside bias versus prior quarter given NAV per share decline and lower adjusted NII, partially offset by unchanged $0.75/share dividend and cash build.
The article discloses sequential NAV per share decline (-4.9%), adjusted NII per share down ($0.53 to $0.47), and non-accrual/write-off details (Pepper Palace to zero; Exigo on red watchlist), which typically pressure valuation for BDCs even when dividends are maintained.
Market effects
Highlights ongoing private credit valuation pressure (declining short-term rates, tight spreads) and rising defaults, reinforcing sector-wide caution for BDCs.
Primarily US BDC sentiment; no specific regional macro linkage beyond the stated macro/interest-rate backdrop.
Limited; references to geopolitical tensions and inflation are general and not tied to specific non-US exposures.
Counterpoint
Dividend continuity ($0.75/share for Q2) plus higher quarter-end cash ($60.8m) could support downside resilience despite NAV markdowns.
Key entities
- companySaratoga Investment Corp.
Reported fiscal first quarter 2027 results (AUM, NAV, adjusted NII, EPS) and detailed portfolio markdowns/non-accrual status.
- portfolio companyPepper Palace
Written down to zero and placed on non-accrual during the quarter, contributing materially to non-CLO core depreciation.
- portfolio companyExigo
Carried at $17.3m (70% of cost) and on red watchlist status, cited as a key contributor to markdowns.