EPS of $0.64 increased by 306.5% from previous year
Gross margin of 100.0%
Net income of 8.83M
""Despite recent challenges, our strategic focus on leveraged loans positions us well to capitalize on market opportunities in the middle-market sector. We believe the upcoming quarters will see improvement as we navigate these transitions."" - CEO
In Q3 2025, Saratoga Investment Corp 800 (SAJ) reported a remarkable revenue of $35.88 billion, although this corresponds to a substantial quarter-over-quarter decrease of 16.57%. Notably, the year-over-year growth was exceptional at an astounding 98,464.97%. Despite this strong revenue performance, net income declined by 33.66% compared to the previous quarter, landing at approximately $8.83 million. The earnings per share (EPS) reflected a similar trend, growing by 306.45% year-over-year yet declining by 34.02% from the previous quarter. The decrease in both net income and EPS, despite robust annual growth figures, raises concerns about profitability amidst fluctuating operational conditions.
Despite extraordinary year-over-year growth, the quarterly performance reflects a sharp contraction in profitability, suggesting increased operational challenges. The deterioration in net income can be attributed to rising operational expenditures and interest expenses, which comprised a significant 36.37% of total revenues.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
35.88B
98 464.97%
-16.57%
Gross Profit
35.88B
127 016.51%
-16.55%
Net Income
8.83M
317.82%
-33.66%
EPS
0.64
306.45%
-34.02%
Key Financial Ratios
currentRatio
0.28
grossProfitMargin
100%
netProfitMargin
0.02%
returnOnAssets
0%
returnOnEquity
0%
debtEquityRatio
2.06
operatingCashFlowPerShare
$6828.23
freeCashFlowPerShare
$6828.23
dividendPayoutRatio
101389%
priceToBookRatio
0
priceEarningsRatio
9.77
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Market Strategy and Outlook
- CEO Quote: "Despite recent challenges, our strategic focus on leveraged loans positions us well to capitalize on market opportunities in the middle-market sector. We believe the upcoming quarters will see improvement as we navigate these transitions."
- CFO Comment: "While we face a downturn this quarter, our balance sheet remains robust. Our liquidity position is solid, with sufficient cash reserves to support our strategic investments."
These insights underscore management’s commitment to navigating the current market volatility while strategically positioning the company's product offerings for growth in the recovering market.
"Despite recent challenges, our strategic focus on leveraged loans positions us well to capitalize on market opportunities in the middle-market sector. We believe the upcoming quarters will see improvement as we navigate these transitions."
— CEO
"While we face a downturn this quarter, our balance sheet remains robust. Our liquidity position is solid, with sufficient cash reserves to support our strategic investments."
— CFO
Forward Guidance
Management expressed cautious optimism for Q4 2025, anticipating a rebound in revenue due to increased deal flow in the leveraged lending space. Specific targets were not disclosed, but the focus will be on enhancing profitability and maintaining liquidity. Investors should monitor interest rates and investor sentiment in leveraged loans, as these factors could significantly impact performance.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
SAJ Focus
1.00%
0.00%
0.00%
9.77%
SCCG
98.00%
-32.60%
-2.79%
-55.36%
RWAYL
77.30%
43.30%
4.94%
9.64%
RILYN
80.30%
-41.00%
57.20%
-33.00%
TRINL
80.50%
74.60%
3.22%
13,993.00%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
In summary, while Saratoga Investment Corp 800 has demonstrated remarkable annual growth in revenue and earnings, the recent quarterly performance indicates notable volatility in profitability metrics. The company's solid cash position and strategic focus on leveraged loans present viable growth opportunities, particularly as market conditions improve. However, investors should remain cautious of inherent risks associated with fluctuating interest rates and economic uncertainties. Overall, Saratoga Investment appears positioned for potential long-term gains, making it an intriguing option for investors willing to accept short-term volatility.
Key Investment Factors
Growth Potential
Saratoga's strategic investment in middle-market companies and leveraged loans provides substantial potential for growth, especially given the anticipated economic recovery post-pandemic.
Profitability Risk
Heightened interest rates pose a risk to net interest margins. Additionally, fluctuations in market risk can impact the value of existing investments and loan portfolios.
Financial Position
With total assets of approximately $1.22 billion and cash reserves exceeding $250 million, Saratoga maintains a solid balance sheet, though its liabilities have increased significantly.
SWOT Analysis
Strengths
Strong revenue growth year-over-year.
Robust liquidity position with significant cash reserves.
Strategic focus on leveraged loans mitigates risk amid market fluctuations.
Weaknesses
Substantial quarter-over-quarter declines in net income and EPS.
High operational costs affecting profitability.
Limited diversification of funding sources.
Opportunities
Increased lending activity anticipated in the middle-market sector as economic conditions stabilize.
Potential to explore new investment avenues and partnerships.
Growing demand for specialized finance solutions in a recovering market.
Threats
Increasing interest rates may pressure profit margins and reduce demand for loans.
Economic uncertainty could affect borrower repayment capacities.
Competitive pressure from other investment services firms targeting the middle market.