Is OBDC a good stock to buy? We came across a bullish thesis on Blue Owl Capital Corporation on Compounding Dividends’s Substack by TJ Terwilliger. In this article, we will summarize the bulls’ thesis on OBDC. Blue Owl Capital Corporation’s share was trading at $11.11 as of March 26th. OBDC’s trailing and forward P/E were 8.99 and 8.26 respectively according to Yahoo Finance.
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Blue Owl Capital Corp (OBDC) is one of the largest business development companies globally, focused on lending to upper-middle-market companies with strong EBITDA profiles, positioning itself as a scaled direct lender with deep ties to private equity sponsors. These relationships provide consistent access to high-quality deal flow, allowing the company to build a portfolio centered on resilient, non-cyclical industries such as software, healthcare, and insurance, which enhances its ability to perform across economic cycles.
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Since inception, OBDC has deliberately constructed a highly diversified portfolio comprising over 230 companies across 30 industries, with limited single-name concentration as the top 10 holdings account for only 23% of the portfolio, reinforcing its risk-managed approach. Credit quality remains solid, supported by a conservative 42% loan-to-value ratio and a 1.9x interest coverage ratio, indicating borrowers’ ability to service debt even in tighter conditions.
The company’s emphasis on defensive sectors, combined with broad industry diversification that includes meaningful exposure to internet software, healthcare services, and asset-based finance, further strengthens its stability and downside protection. In addition to its portfolio construction, OBDC has demonstrated strong shareholder alignment through opportunistic share buybacks when trading below net asset value, signaling confidence in intrinsic value.
Currently, the stock trades at a significant discount to NAV at 0.74x while offering an attractive dividend yield of approximately 13.5%, presenting a compelling income-oriented investment opportunity. This combination of high yield, discounted valuation, disciplined underwriting, and diversified exposure to resilient industries positions OBDC as an appealing option for investors seeking stable cash flows with potential upside from valuation normalization.
Previously, we covered a bullish thesis on BlackRock, Inc. (BLK) by Kroker Equity Research in February 2025, which highlighted the company’s massive AUM scale, strong net inflows, and diversified revenue streams across ETFs, private markets, and its Aladdin platform. BLK’s stock price has depreciated by approximately 2.37% since our coverage due to broader market volatility. TJ Terwilliger shares a similar view but emphasizes on Blue Owl Capital’s high-yield, defensive lending model and discounted valuation.
Blue Owl Capital Corporation is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 22 hedge fund portfolios held OBDC at the end of the fourth quarter which was 23 in the previous quarter. While we acknowledge the risk and potential of OBDC as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than OBDC and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
