FS KKR Capital (NYSE:FSK) Issues Earnings Results, Beats Estimates By $0.01 EPS

FS KKR Capital (NYSE:FSK) issued its quarterly earnings data on Thursday. The company reported $0.43 earnings per share for the quarter, topping the consensus estimate of $0.42 by $0.01, FiscalAI reports. The company had revenue of $290.00 million during the quarter, compared to analyst estimates of $286.75 million. FS KKR Capital had a positive return on equity of 9.43% and a negative net margin of 28.52%.During the same period in the prior year, the business posted ($0.75) earnings per share.

Here are the key takeaways from FS KKR Capital’s conference call:

• Net asset value declined 2.8% to $18.30 per share, driven by a $0.56-per-share decline in portfolio valuations despite $0.44 per share of GAAP net investment income.
• Second-quarter net investment income was $0.44 per share, while adjusted net investment income was $0.43; management expects annualized net investment income of 8%–9% of NAV for the remainder of 2026.
• FSK reduced leverage, with debt-to-equity falling to 127% from 138%, and reported $3.5 billion of available liquidity. KKR also completed a $150 million share purchase and a $150 million preferred-stock investment, while FSK repurchased approximately $40 million of common stock through early third quarter.
• Portfolio rotation accelerated through roughly $500 million of third-party loan sales and $1.3 billion of net sales and repayments, helping reduce the portfolio by $735 million and shift its composition toward first-lien and senior-secured assets.
• Credit quality remains a concern: two investments entered non-accrual status, and non-accruals still represented 7.1% of the portfolio at cost and 3.8% at fair value, although both measures improved from the prior quarter.

FS KKR Capital Trading Up 4.5%

Shares of NYSE FSK traded up $0.54 during trading on Friday, reaching $12.42. The stock had a trading volume of 4,865,263 shares, compared to its average volume of 2,577,550. The company has a debt-to-equity ratio of 1.38, a quick ratio of 2.00 and a current ratio of 2.00. The company has a market cap of $3.48 billion, a P/E ratio of -9.20 and a beta of 0.83. FS KKR Capital has a fifty-two week low of $9.72 and a fifty-two week high of $18.85. The business’s 50-day moving average price is $10.75 and its 200-day moving average price is $11.26.

FS KKR Capital Increases Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Friday, October 2nd. Stockholders of record on Wednesday, September 16th will be paid a $0.44 dividend. The ex-dividend date of this dividend is Wednesday, September 16th. This is a boost from FS KKR Capital’s previous quarterly dividend of $0.42. This represents a $1.76 dividend on an annualized basis and a dividend yield of 14.2%. FS KKR Capital’s payout ratio is presently -85.28%.

FS KKR Capital News Summary

Here are the key news stories impacting FS KKR Capital this week:

• Positive Sentiment: FSK reported second-quarter adjusted net investment income of $0.43 per share, exceeding the $0.42 consensus estimate, while revenue of $290 million also topped expectations of $286.75 million. Results improved substantially from the prior-year loss of $0.75 per share. FS KKR Capital Q2 Earnings and Revenues Surpass Estimates
• Positive Sentiment: The board declared a third-quarter distribution of $0.44 per share, up 4.8% from $0.42 previously and equivalent to an approximately 14.8% annualized yield. The dividend is payable October 2 to shareholders of record September 16. FS KKR Capital Announces Second Quarter Results and Distribution
• Positive Sentiment: Management expects 8%–9% annualized net investment income for the remainder of 2026 and is advancing share repurchases and portfolio rotation. Debt-to-equity declined to 127% from 138%, moving leverage closer to the company’s target range. FSK Expects 8% to 9% Annualized Net Investment Income
• Positive Sentiment: A Seeking Alpha analysis upgraded FSK to a “Buy,” reflecting a more favorable view of its income outlook, valuation and improving credit trends. FS KKR Time to Get Bullish Again
• Neutral Sentiment: Truist raised its price target from $11 to $12 but maintained a “Hold” rating, indicating limited expected upside at recent trading levels. Benzinga
• Negative Sentiment: Net asset value fell to $18.30 per share from $18.83, and FSK posted a second-quarter GAAP loss of $0.13 per share because of $0.56 per-share realized and unrealized investment losses. Continued portfolio losses and non-accrual assets remain important risks. FS KKR Capital Second Quarter Results

Hedge Funds Weigh In On FS KKR Capital

Hedge funds and other institutional investors have recently bought and sold shares of the company. Oak Hill Advisors LP purchased a new stake in shares of FS KKR Capital during the fourth quarter worth $38,659,000. Balyasny Asset Management L.P. acquired a new stake in shares of FS KKR Capital in the third quarter valued at $21,917,000. Marshall Wace LLP purchased a new position in FS KKR Capital in the fourth quarter valued at $14,842,000. Trexquant Investment LP purchased a new position in FS KKR Capital in the fourth quarter valued at $9,053,000. Finally, XTX Topco Ltd acquired a new position in FS KKR Capital during the 4th quarter worth $7,053,000. 36.26% of the stock is currently owned by hedge funds and other institutional investors.

Analysts Set New Price Targets

FSK has been the topic of several recent analyst reports. Capital One Financial set a $12.00 price target on FS KKR Capital in a research note on Friday. Wells Fargo & Company cut their price objective on FS KKR Capital from $11.00 to $10.00 and set an “equal weight” rating for the company in a research report on Tuesday, May 12th. Weiss Ratings restated a “sell (d+)” rating on shares of FS KKR Capital in a report on Tuesday, June 2nd. Keefe, Bruyette & Woods decreased their target price on shares of FS KKR Capital from $15.00 to $11.00 and set a “market perform” rating on the stock in a research report on Thursday, April 16th. Finally, Zacks Research lowered shares of FS KKR Capital from a “hold” rating to a “strong sell” rating in a research note on Monday, July 13th. Six investment analysts have rated the stock with a Hold rating and two have assigned a Sell rating to the stock. Based on data from MarketBeat.com, the company currently has a consensus rating of “Reduce” and an average target price of $10.93.

About FS KKR Capital

FS KKR Capital Corp (NYSE:FSK) is a closed-end, externally managed business development company that primarily invests in private middle-market U.S. companies. The firm seeks to generate current income and capital appreciation by structuring investments in floating-rate senior secured loans, unitranche financings, second lien debt and mezzanine instruments. As a business development company, FSK provides financing solutions designed to support growth initiatives, acquisitions, leveraged buyouts and recapitalizations for privately held enterprises.

Established in 2018 through a strategic partnership between FS Investment Corporation and KKR Credit Advisors, a division of global investment firm KKR & Co Inc, FSK combines the credit underwriting capabilities of KKR’s global platform with FS’s expertise in private credit markets.