Cash conversion remains highly erratic, evidenced by an OCF/NI ratio that swung from -5.53 in 2025Q1 to 5.22 in 2025Q3, indicating that GAAP earnings provide limited visibility into actual cash-generating capacity.
| Cash from Operations | 55.61M | 160.66M | 106.73M | 57.12M | -39.25M | -438.01M | 16.19M |
| Operating CF Margin % | - | 144.48% | 96.75% | 37.17% | 79.46% | -1482.7% | 66.23% |
| Operating CF Growth % | -63.81% | 50.53% | 86.86% | 245.53% | 91.04% | -2804.95% | - |
| Net Income | -32.02M | -3.17M | 47.67M | 107.84M | -74.48M | 19.06M | 26.73M |
| Depreciation & Amortization | 444.06M | 0 | 0 | 0 | 0 | 0 | 0 |
| Stock-Based Compensation | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Deferred Taxes | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Non-Cash Items | -309.58M | 205.22M | 13.96M | -50.69M | 114.83M | -540.19M | -14.19M |
| Working Capital Changes | -50.94M | -41.4M | 45.1M | -24.9K | -79.6M | 83.12M | 3.65M |
| Change in Receivables | 12.13M | 8.64M | -10.26M | 27.14M | -16.3M | -7.96M | -13.5M |
| Change in Inventory | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Change in Payables | -41.41M | 0 | 55.06M | -27.66M | -62.9M | 91.28M | 17.14M |
| Cash from Investing | 68.44M | 0 | -305.05M | -26.65M | 35.4M | -519.55M | -586.26M |
| Capital Expenditures | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| CapEx % of Revenue | 0% | - | 0% | - | 0% | - | 0% |
| Acquisitions | 0 | - | - | - | - | - | - |
| Investments | 1.15B | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Investing | 11.72B | 0 | 0 | 0 | 0 | 0 | 0 |
| Cash from Financing | -125.43M | -160.21M | 198.97M | -30M | 4.4M | 438.42M | 570.75M |
| Debt Issued (Net) | 0 | - | - | - | - | - | - |
| Equity Issued (Net) | -18.11M | -17.48M | 90.46M | 17.65M | 5.02M | 188.86M | 233.67M |
| Dividends Paid | -53.07M | -55.28M | -46.59M | -33.92M | -18.83M | -6.29M | -3.37M |
| Share Repurchases | -18.11M | -18M | -1.26M | 0 | 0 | 0 | 0 |
| Other Financing | 0 | -1.25M | 0 | 0 | 0 | -780.62K | 0 |
| Net Change in Cash | -1.38M | 451.04K | 649.3K | 466.31K | 557.3K | 410.92K | 681.08K |
| Free Cash Flow | 55.61M | 160.66M | 106.73M | 57.12M | -39.25M | -438.01M | 16.19M |
| FCF Margin % | 91.11% | 144.48% | 96.75% | 37.17% | 79.46% | -1482.7% | 66.23% |
| FCF Growth % | -51.13% | 50.53% | 86.86% | 245.53% | 91.04% | -2804.95% | - |
| FCF per Share | 1.78 | 5.00 | 3.27 | 1.75 | -1.22 | -13.64 | 0.50 |
| FCF Conversion (FCF/Net Income) | -1.74x | -50.69x | 2.24x | 0.53x | 0.53x | -22.98x | 0.61x |
| Interest Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Portfolio Valuation Volatility
As reported in financial statements, PSBD exhibits a highly erratic relationship between net income and operating cash flow, with the OCF/NI ratio swinging from -5.53 in 2025Q1 to 5.22 in 2025Q3, indicating that GAAP earnings provide little visibility into the firm's actual cash-generating capacity.
The extreme divergence between net income and operating cash flow suggests that non-cash mark-to-market adjustments are heavily distorting the bottom line. Investors should interpret this volatility as a sign that the firm's reported earnings are not a reliable proxy for the underlying cash yield of the loan portfolio.
Based on the provided cash flow data, PSBD's free cash flow trajectory is characterized by extreme instability, with quarterly FCF oscillating between a peak of $50.4M in 2024Q4 and a low of -$30.8M in 2024Q3, reflecting the inherent unpredictability of the firm's investment-related cash flows.
This erratic FCF performance suggests that the firm's ability to fund dividends and operations is highly sensitive to the timing of portfolio exits and interest receipts. The lack of a stable FCF trend warrants caution regarding the long-term sustainability of current capital allocation policies.
According to recent SEC filings, PSBD's working capital movements are highly volatile, with a $35.9M inflow in 2024Q4 followed by a $46.3M outflow in 2024Q3, suggesting that the firm's cash position is frequently impacted by large, non-operational shifts in balance sheet accounts.
These significant swings in working capital appear to be the primary driver of the firm's inconsistent operating cash flow. Analysts should monitor whether these fluctuations represent genuine changes in interest accruals or if they reflect broader liquidity management challenges within the BDC's investment structure.
As indicated by the historical cash flow data, PSBD has consistently paid dividends despite periods of negative free cash flow, such as the -$30.8M FCF recorded in 2024Q3, which suggests that dividend distributions may be relying on balance sheet liquidity rather than recurring operational cash generation.
The persistence of dividend payments during quarters of negative cash flow raises questions about the firm's capital allocation discipline. Investors should investigate whether this payout strategy is sustainable without further capital raises or increased leverage, especially given the recent negative net margin environment.
Quick answers to the most common questions about buying PSBD stock.
Palmer Square Capital BDC Inc. (PSBD) generated $160.7M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Palmer Square Capital BDC Inc. (PSBD) generated $160.7M in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
Palmer Square Capital BDC Inc. (PSBD) spent $0.0M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, Palmer Square Capital BDC Inc. (PSBD) returned $55.3M to shareholders via cash dividends and spent $18.0M on share repurchases. This shows the company's commitment to returning capital to its equity investors.