Longtime readers of Income Investors would know that I’m a big fan of business development companies (BDCs). These companies usually provide loans to middle-market businesses in the U.S., earning oversized interest income in the process. In turn, they tend to pass that income to investors through generous dividend payments.
At first glance, NEWTEK Business Services Corp (NASDAQ:NEWT) seems like just another BDC. The company provides financing solutions to small- and medium-sized businesses and collects interest payments from its lending portfolio. And like many BDCs, it offers a rather generous dividend yield. If you dig a little deeper, though, you’d see that NEWTEK just might be the most interesting BDC in today’s market.
Source: Income Investors
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