Forensic Analysis · General / Diversified · as of Aug 11, 2026

Stellus Capital Investment Corp (SCM)

A forensic read on Stellus Capital Investment Corp built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.

D · Weak — demands caution

Forensic grade

Clean

Earnings quality

Forensic signals

10.3

P / E (ttm)

7.3%

ROE

$255M

Market cap

11.80%

Dividend yield

-2.1%

Revenue growth

This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (red flags, auditor quality, say on pay, board independence). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.

Stellus Capital Investment Corp earns a D (Weak — demands caution) forensic quality grade. 3 forensic signals were flagged in its latest SEC filings, led by cash conversion.

What the filings flag

-0.78×

FY2023–FY2025

Cash conversion. Over FY2023–FY2025, operating cash flow was -0.78× cumulative net income. Reported profit is not turning into cash. The shortfall is profit tied up in working capital rather than collected — the accrual and receivables lines below show where.

+13.2%/yr

FY2022–FY2025

Share-count dilution. Diluted share count changed +45% over the last 3 years to FY2025 (+13.2%/yr). The count is growing: more stock was issued than repurchased over this window, so aggregate results grew faster than their per-share equivalents. That's ~13.2% shaved off per-share growth every year — total profit has to grow that much just to keep earnings-per-share flat, and a stake held since FY2022 has been diluted ~31%.

OCF ($24M)

FY2025

Shareholder returns. Returned $45M to shareholders (buybacks + dividends) in FY2025, while operating cash flow itself was ($24M) — zero or negative. Capex isn't disclosed for FY2025, but free cash flow can't have been positive when operating cash flow already isn't, so the entire return is coming from debt or cash reserves, not cash the business generated.

Key fundamentals

Latest Revenue$97.8M

Revenue Growth YoY-2.1%

Revenue CAGR (3yr)+26.3%

Net Margin27.7%

Return on Equity7.3%

Debt / Equity0.33x

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Data from SEC EDGAR public filings · metrics as of Aug 11, 2026. Forensic signals flag probability, not certainty.