Main Street Capital stock trades at a premium to NAV, but this is justified by consistent NAV growth, tax efficiency, and unique equity investments. Including special dividends, MAIN's yield is higher than it appears, and NAV growth pushes total return to around 10.5% annually. MAIN's internally managed structure and equity investments enable NAV accretion and lower expenses, differentiating it from peers like ARCC. For long-term, tax-aware investors, MAIN offers superior after-tax returns, while discount BDCs like PSEC are less attractive due to NAV decay and tax inefficiency.

Main Street Capital Corporation (NYSE:MAIN) is a darling of the BDC space. It consistently trades at a 1.6-1.8x NAV per share, which is far above what most BDCs trade at, except

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Stephen Nemo
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Individual investor with individual interests in investment opportunities. My articles are primarily written to advance my personal understanding, and I share them to share my knowledge and hope to see what the market (you) have to say about them. My primary interest are BDCs, banks, and companies in low competition olgopolies.

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Main Street Capital: Dissecting Its Premium Valuation (NYSE:MAIN)

Main Street Capital (MAIN) trades at a premium to its Net Asset Value (NAV), driven by consistent NAV growth, tax efficiency, and unique equity investments. The article highlights its superior after-tax returns compared to discount BDCs like PSEC and contrasts it with peers like ARCC. The analysis emphasizes MAIN's differentiated structure and long-term appeal to tax-aware investors.