Oaktree Specialty Lending Corporation Common Stock (OCSL)

FairStock Score: 50/100 — MIXED

Key Financials

Strengths

• Generates $182 million in annual free cash flow (16.4% yield on market cap)
• Healthy net profit margin of 12.0% showing consistent profitability
• Revenue growth of 178.0% demonstrates strong top-line momentum
• Attractive 12.5% dividend yield providing steady income returns

Concerns

• Weak Piotroski F-Score of 2/9 suggests deteriorating financial quality across multiple dimensions
• Altman Z-Score of -0.0 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Oaktree Specialty Lending Corporation Common Stock is a micro-cap financial services company valued at $1.1 billion. The business generates $305 million in annual revenue with a 12.0% net margin and $182 million in free cash flow. From a quality standpoint, Oaktree shows weak Piotroski F-Score of 2/9 signaling deteriorating fundamentals and distressed Altman Z-Score of -0.0 warrants caution. On valuation, the stock is trading at a premium 34.7x earnings, with trades above its Graham Number with a negative 10% margin. Growth dynamics show revenue growing at 178.0% and profit growth of -22.5%. The 12.5% dividend yield adds an income component for patient holders. Our composite FairStock Score of 50/100 reflects mixed fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Oaktree's 178% revenue growth trajectory could accelerate as it captures additional market share in the financial services sector. With $182 million in annual free cash flow (16.4% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 35x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer