Owl Rock Capital Corporation (ORCC): history, ownership, mission, how it works & makes money

A Brief History of Owl Rock Capital Corporation (ORCC)

Foundation and Formation

Owl Rock Capital Corporation (ORCC) was established in 2016 as a publicly traded business development company (BDC). The founding goal was to provide flexible, long-term capital solutions to middle-market companies.

Initial Public Offering (IPO)

ORCC launched its initial public offering on April 18, 2019, raising approximately $1.1 billion. The shares were listed on the New York Stock Exchange under the ticker symbol "ORCC."

Investment Strategy

ORCC employs a strategy focused on investing in senior secured loans, subordinated debt, and equity co-investments. The target investments typically range from $10 million to $50 million in companies with established business models.

Financial Performance

As of December 31, 2022, ORCC reported a total investment portfolio of approximately $9.8 billion, demonstrating substantial growth since the IPO.

Key Partnerships

In 2020, ORCC partnered with Owl Rock Capital Advisors for investment management. This collaboration aimed to leverage extensive networks and expertise in middle-market finance.

Diversification and Risk Management

ORCC focuses on maintaining a diversified portfolio across various industries such as healthcare, technology, and manufacturing. As of the end of 2022, its portfolio consisted of investments in over 300 companies.

Recent Developments

In 2023, ORCC reported a strong performance, with a net asset value of approximately $14.50 per share as of the second quarter. The company declared a dividend of $0.30 per share for Q2 2023.

Market Position

As of mid-2023, Owl Rock Capital Corporation is one of the largest BDCs in the United States, with a market capitalization exceeding $4 billion.

Future Outlook

Analysts anticipate continued growth in ORCC's investment portfolio, driven by favorable market conditions for middle-market lending. Projections suggest a potential portfolio growth rate of 8%-10% annually over the next five years.

A Who Owns Owl Rock Capital Corporation (ORCC)

Overview of Ownership Structure

Owl Rock Capital Corporation (ORCC) is primarily structured as a business development company (BDC). The ownership of ORCC includes institutional investors, individual shareholders, and its management team. As of December 31, 2022, the significant shareholders included:

Top Institutional Shareholders

The following table outlines the top institutional shareholders of ORCC, reflecting their stake as of the latest filings:

Management Ownership

The management team of ORCC also holds a significant stake in the company, which aligns their interests with those of shareholders.

Recent Financial Performance

Owl Rock Capital Corporation has shown considerable financial performance. The following are key metrics as of the end of Q2 2023:

Recent Stock Performance

The performance of ORCC shares on the NASDAQ exchange throughout 2023 has been notable. The following table reflects average trading data:

Owl Rock Capital Corporation (ORCC) Mission Statement

Core Mission

Owl Rock Capital Corporation (ORCC) aims to provide flexible, creative capital solutions to middle-market companies. The firm's mission is centered on fostering growth and supporting the operational innovation of its portfolio companies while delivering strong risk-adjusted returns to its investors.

Investment Strategy

ORCC focuses on direct lending to middle-market companies in the United States. The company's investment strategy is primarily centered around:

• Providing senior secured loans
• Offering subordinated debt and equity co-investments
• Targeting businesses with revenues typically ranging from $50 million to $1 billion

Financial Performance

As of the end of fiscal year 2022, Owl Rock Capital reported the following financial metrics:

Portfolio Overview

As of September 30, 2023, ORCC's investment portfolio was diversified across various sectors:

Commitment to Stakeholders

Owl Rock Capital Corporation emphasizes its commitment to various stakeholders, including:

• Investors: Aiming to generate compelling risk-adjusted returns.
• Portfolio Companies: Providing support and necessary capital for growth.
• Employees: Fostering a culture of integrity, collaboration, and innovation.
• Community: Engaging in philanthropic initiatives and sustainable practices.

Recent Developments

In 2023, ORCC achieved notable milestones such as:

• Increased total commitments to portfolio companies by 15% year-over-year.
• Expansion of senior secured loans with an average yield of 7.5%.
• Implementing a new ESG (Environmental, Social, and Governance) framework to enhance investment decisions.

Future Goals

Looking ahead, ORCC aims to:

• Expand its investment capabilities in diverse sectors.
• Enhance its technological infrastructure for portfolio management.
• Strengthen partnerships with investors for increased capital access.

How Owl Rock Capital Corporation (ORCC) Works

Business Model

Owl Rock Capital Corporation (ORCC) operates as a business development company (BDC) that primarily focuses on providing financing to U.S. middle-market companies. The company utilizes a combination of secured and unsecured debt, as well as equity investments to achieve its objectives.

Investment Strategy

ORCC targets companies with an EBITDA range of $10 million to $150 million. The typical investments are aimed at achieving a diversified portfolio across various sectors, including:

• Healthcare
• Technology
• Consumer Products
• Business Services
• Manufacturing

Financial Performance

As of Q3 2023, ORCC reported total assets amounting to $5.8 billion, with a net asset value (NAV) of approximately $1.6 billion. The company focuses on providing attractive risk-adjusted returns to its shareholders.

Revenue Generation

For the fiscal year ending December 2022, ORCC recorded total investment income of $491 million, with a net investment income of $239 million. The net investment income per share stood at $1.41.

Capital Structure

The capital structure of ORCC includes:

• Total debt: $2.9 billion
• Equity raised: $1.8 billion
• Debt-to-equity ratio: 1.6x

Portfolio Composition

As of Q3 2023, ORCC’s investment portfolio comprised 128 investments, with a fair value of $4.6 billion. The breakdown by industry sector is as follows:

Dividend Policy

ORCC has a history of regular dividend payments. For the year 2023, the company declared a quarterly dividend of $0.33 per share, which translates to an annualized dividend yield of approximately 8.2% based on a share price of $16.00 as of October 2023.

Risk Management

Owl Rock Capital Corporation employs a robust risk management framework that includes:

• Regular credit assessments
• Diversification of investment portfolio
• Monitoring macroeconomic indicators

Recent Developments

In Q3 2023, ORCC announced a partnership with a leading private equity firm to co-invest in mid-market companies, potentially expanding their investment capacity by an additional $500 million.

How Owl Rock Capital Corporation (ORCC) Makes Money

Investment Strategy

Owl Rock Capital Corporation focuses on providing direct lending solutions primarily to U.S. middle-market companies. The firm employs a strategy centered around originating, investing in, and managing loans that generate interest income. As of September 30, 2023, ORCC reported a portfolio comprised of 124 investments, with a total fair value of approximately $5.2 billion.

Sources of Revenue

The primary sources of revenue for ORCC include:

• Interest Income: The dominant revenue source, comprising around 80% of total revenue.
• Fee Income: Includes fees for structuring and underwriting loans.
• Realized Gains: Profit from the sale of portfolio investments.
• Investment Management Fees: Fees charged for managing investment portfolios.

Portfolio Composition

As of the latest financial quarter, ORCC's investment portfolio was spread across various sectors, providing diversification and risk management. Below is a breakdown by industry:

Financial Performance

Owl Rock Capital Corporation reported strong financial metrics in the most recent quarter:

• Total Revenue: $320 million for the quarter ending September 30, 2023.
• Net Investment Income: $174 million, reflecting a yield of approximately 8.1% on the portfolio.
• Distributions: Monthly distribution of $0.13 per share, translating to an annualized yield of about 10.4% based on the current stock price.
• Assets Under Management (AUM): Approximately $11 billion.

Investment Risks and Controls

ORCC employs a rigorous risk management framework to mitigate potential investment risks. Key aspects include:

• Credit Risk Assessment: Comprehensive evaluation of borrower creditworthiness.
• Diversification: Maintaining a well-diversified portfolio across sectors and geographies.
• Regular Monitoring: Continuous assessment of portfolio performance and market conditions.

Market Position

As of the end of Q3 2023, ORCC is positioned as one of the largest business development companies (BDCs) in the U.S. The following metrics illustrate its competitive standing:

Conclusion of Revenue Generation

In summary, Owl Rock Capital Corporation employs a multi-faceted approach to generate revenue through direct lending to middle-market companies, underpinned by a diversified portfolio and robust financial principles. The company's strategic focus on interest income, coupled with careful risk management, positions it for continued success in the competitive lending landscape.