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what it is
It lends money to middle-market companies and sometimes takes equity stakes when the deal gets extra weird.
how it gets paid
Last year Sixth Street Special made $482M in revenue. Senior secured loans was the main engine at $0.27B, or 55% of sales.
what just happened
TSLX posted $108.2M in quarterly revenue, and the market still cared more about the dividend than the headline.
At a glance
B+ balance sheet — decent shape, but not bulletproof
45/100 earnings predictability — expect surprises
11.1x trailing p/e — the market's not buying it — or you found a deal
10.8% dividend yield — cash in your pocket every quarter
8.5% return on capital — nothing to write home about
xvary composite: 62/100 — average
What they do
It lends money to middle-market companies and sometimes takes equity stakes when the deal gets extra weird.
Sixth Street brings a $100B+ platform to a $2B stock. That is the whole joke. Your small lender gets the muscle of a giant. Co-investments, which means it puts its own money beside partners, let it chase larger deals without owning them outright. It spreads that capital across 10 industries, so one borrower does not own your night.
How they make money
$482M
annual revenue
Senior secured loans
$0.27B
Mezzanine debt
$0.10B
Non-control structured equity
$0.07B
Common equity
$0.05B
The products that matter
first-lien lending
Senior Secured Loans
86% of portfolio · core underwriting book
This is 86% of the $3.4B portfolio. It matters because first-lien positions get paid before junior creditors if a borrower runs into trouble.
portfolio anchor
subordinated credit and upside
Mezzanine Debt & Equity
14% of portfolio · higher return, less protection
This 14% slice helps push toward the 11–11.5% return-on-equity target. It also sits lower in the capital stack, which means more risk if credit cracks.
return booster
cash distributions to shareholders
Dividend Stream
10.8% yield · paid from investment income
For most shareholders, this is the product. A 10.8% yield is attractive, but it only works as long as loan income keeps covering the payout.
why investors show up
Key numbers
$2.03
fy2024 eps est
$483M
fy2024 rev est
11.1x
trailing p/e
10.8%
dividend yield
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 100 / 100
- long-term debt $1.5B (48% of capital)
B+ — functional but not a standout on the balance sheet.
Total return vs. market
Return history isn't available for TSLX right now.
source: institutional data · return history unavailable
What just happened
beat estimates
TSLX posted $108.2M in quarterly revenue, and the market still cared more about the dividend than the headline.
Revenue topped the $106M estimate, and the quarter also showed a reported EPS of $1.50. The business keeps most of what it earns, with showing a 79.7% operating margin.
$108.2M
revenue
$1.50
eps
79.7%
gross margin
revenue
Revenue mattered most because $108.2M beat the $106M bar and tells you the lending book is still throwing off cash.
source: company earnings report, 2026
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What could go wrong
Your #1 risk is middle-market credit deterioration inside a $3.4B portfolio that exists to fund the dividend.
med
credit losses rise
As a lender to smaller companies, TSLX is exposed when borrowers miss payments. A 2% increase in non-accruals would directly hit the $0.52 per share quarterly income run-rate.
That is the risk that turns a 10.8% yield from generous into temporary.
med
rates move the wrong way
Most of the revenue base is interest income — $462M of $483M total. If benchmark rates fall faster than funding costs, net investment income can compress.
Management's 11–11.5% ROE target gets harder to hit if spread income narrows.
med
leadership transition changes the playbook
Joshua Easterly is retiring in 2026. New leadership may keep the same underwriting posture, but until you see a few quarters, that is an assumption, not a fact.
With a leveraged credit vehicle, small changes in risk appetite can matter a lot.
A 2% increase in loan defaults could wipe out roughly a quarter of the current quarterly income stream supporting the dividend.
source: institutional data · regulatory filings · risk analysis
Pay attention to
coverage
quarterly adjusted NII
The latest adjusted net investment income was $0.52 per share. If that starts slipping, the yield story gets less comfortable very quickly.
guidance
2026 ROE target
Management is guiding to 11–11.5% return on equity. That is the internal benchmark for whether the portfolio is earning enough to justify the current valuation.
leadership
2026 board transition
Joshua Easterly will not seek re-election at the 2026 annual meeting. You are watching for continuity in underwriting standards, not just a clean succession headline.
payout quality
supplemental dividends
A supplemental dividend showed up in Q4 2025. If those extras disappear, that may simply mean realized gains cooled — but it also tells you the income cushion is thinner than the headline yield suggests.
Analyst rankings
earnings predictability
45 / 100
In human-speak, analysts do not see this as a smooth, easy-to-model earnings stream.
balance sheet
B+
Good enough to operate comfortably. Not so strong that you ignore leverage.
price stability
100 / 100
The stock itself has been unusually steady. That does not make the underlying credit book risk-free.
source: institutional data
Institutional activity
institutional ownership data for TSLX is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$22
current price
n/a
target midpoint · n/a from current
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