Saratoga Investment Corp (SAR) — RQD Stock Rating Cockpit

Per the Roarable RQD rating, SAR scores 35 out of 100, earning a letter grade of D- and the verdict "Roarable Sell — Vulnerable Balance Sheet & Flow." The fundamental cash engine pillar scores 5 out of 20, with ROIC of 8.9% and an FCF yield of 0%; for an investor, this signals that the business is not currently converting capital into free cash flow at a rate the rating system considers strong, which limits the cushion available if earnings or valuation multiples compress. The whale 13F flow pillar scores 3 out of 20, reflecting institutional accumulation and options positioning that the rating does not view as supportive. The insider conviction pillar scores 10 out of 20, based on SEC Form 4 and Congressional PTR cluster flow, indicating a weaker signal of insider confidence than the other pillars would suggest is needed. The macro regime fit pillar scores 7 out of 20, with a beta of 1.0 and sector sensitivity noted in the rating inputs. The forensic balance sheet pillar scores 10 out of 20, supported by an Altman Z-Score of 2.5, a Piotroski F-Score of 2/9, and a Debt/Equity ratio of 0.5; the low Piotroski reading is the most direct indicator of financial-quality weakness in the source data. Taken together, the rating points to a stock whose attractive-looking multiples sit alongside weak cash generation and weak institutional and forensic support. A prospective investor would need to weigh the low P/E against the zero FCF yield and the weak quality signals before drawing any conclusion.

Per the SEC financials, reported revenue and operating income are $0.0M across all three periods, and the gross, operating, and net margin figures in the market data are each 0%. Net income rose from $8.9M in FY 2023 to $36.6M in FY 2025, while free cash flow was negative in FY 2023 and FY 2025 and positive in FY 2024. Per the market data, ROIC is 8.9%. The Altman Z-Score is 2.5 and the Piotroski F-Score is 2/9, per the Roarable RQD rating forensic inputs. Debt/Equity is 0.5 per the same source. Cash was $52.3M at FY 2025 versus $147.6M at FY 2024.

The news wire contains six items, all tagged to SAR. Two headlines report that Saratoga Investment reported Q2 earnings below estimates: one from Yahoo Finance and one from ChartMill, the latter noting shares sliding 6.3% after hours. A TradingView item states that shares slipped after the Q2 earnings miss. An Investing.com item reports that B.Riley cut its stock price target on a NAV decline. A Yahoo Finance item and a Quiver Quantitative item are tagged as market wire coverage of fiscal Q2 earnings. Risk-watch flags are attached to the ChartMill, TradingView, and Investing.com items. The butterfly supply-chain graph reports no supply chain and no proprietary signals, so no butterfly-link catalysts are available.

• What is the company's business model and revenue source, given that reported revenue is $0.0M in every period?
• What explains the gap between positive net income and negative free cash flow in FY 2023 and FY 2025?
• What is the current debt balance, since debt is listed as N/A for all periods?
• What is the basis for the B.Riley price target cut tied to NAV decline, and what NAV figures were involved?
• What is the EV/EBITDA and what drove the Q2 earnings miss relative to estimates?