XAI Octagon Floating Rate & Alternative Income Term Trust (XFLT) AI Stock Analysis
XFLT AI stock analysis summary
AI ResearchXAI Octagon Floating Rate & Alternative Income Term Trust (NYSE: XFLT) is a Chicago-based asset management fund. The trust saw revenue drop 43.7% in FY2025 to $32.5M, while trailing twelve months EPS stood at -$3.90. Shares offer a dividend yield of 14.83%, but have delivered a 1-year return of -13.0%.
- Market cap
- $277.4M
- Revenue (TTM)
- $0
- P/E
- —
- 1Y return
- -13.0% S&P 500 16.8%
- Avg. target
- $8.00 -56.1% vs last close
Bull case
- The fund offers a high forward dividend yield of 14.83% distributed on a monthly schedule.
- Free cash flow turned positive in FY2025 to $42.5M after negative generation of -$182.0M in FY2024.
- The trust trades at a price-to-book multiple of 0.9x relative to its shareholders' equity of $339.7M.
Bear case
- The analyst mean price target of $8.00 sits 56.1% below the last closing price of $18.21.
- Total debt of $237.6M significantly exceeds cash and short-term investments of $10.1M as of March 31, 2026.
- FY2025 dividends paid of $65.7M exceeded the free cash flow generated of $42.5M.
What XAI Octagon Floating Rate & Alternative Income Term does
XAI Octagon Floating Rate & Alternative Income Term Trust is an asset management entity headquartered in Chicago, Illinois. Operating within the Financial Services sector, the trust completed its initial public offering in 2017 and trades under the ticker XFLT on the NYSE.
Growth and profitability
Revenue history has been volatile, moving from $38.4M in FY2021 down to -$31.1M in FY2022, before rebounding to $53.0M in FY2023 and $57.7M in FY2024. In FY2025, revenue fell 43.7% to $32.5M, with gross margin declining to 60.2% and operating margin reaching 30.4%. Net income dropped from $48.9M in FY2024 to $9.9M in FY2025, resulting in an EPS of $0.00 compared to $0.53 the prior year. Over the trailing twelve months ending March 31, 2026, revenue was reported at $0 with an EPS of -$3.90 and an operating margin of 0.0%.
Balance sheet and cash flow
As of March 31, 2026, the trust held $10.1M in cash and short-term investments alongside total debt of $237.6M, resulting in net debt of $227.5M. Total assets stood at $599.8M and shareholders' equity was $339.7M, yielding a debt-to-equity ratio of 0.70 and a current ratio of 1.57. For FY2025, operating cash flow turned positive to $55.0M, generating $42.5M in free cash flow with capital expenditures of $3. During that year, the fund paid $65.7M in dividends, exceeding its annual free cash flow.
Valuation and performance
With a market cap of $277.4M, XFLT trades at a price-to-sales multiple of 14.1x, well above the 3.2x median of its US-listed Financial Services peers. Its price-to-book ratio is 0.9x. The trust's shares closed at $18.21, reflecting a 1-year return of -13.0% and a 5-year return of -14.6%, lagging the S&P 500 (SPY) returns of 16.8% and 83.0% over the same periods.
XFLT dividend
XFLT pays a monthly distribution with an annual forward dividend of $2.70, translating to a dividend yield of 14.83%. The trust has paid dividends for 10 consecutive years, achieving an annualized 5-year dividend growth rate of 1.9%. The most recent ex-dividend date was October 15, 2026.
What analysts expect
Analysts have established a mean price target of $8.00 for XFLT, representing a -56.1% downside compared to the last close of $18.21. In terms of earnings execution, the fund recorded 0 EPS beats over the last 4 quarters.
Key risks and what to watch
- Trailing twelve months EPS was -$3.90, alongside 0 EPS beats over the last 4 quarters.
- Revenue fell 43.7% in FY2025 to $32.5M after reaching $57.7M in FY2024.
- The fund's 1-year return of -13.0% underperformed the S&P 500 return of 16.8%.
AI-generated research summary. Written with AI from Quotelinks data as of October 16, 2026 and checked so every figure matches that data. For information only, not investment advice. Disclaimer
About this XFLT AI stock analysis
This page is an AI-written research summary of XAI Octagon Floating Rate & Alternative Income Term Trust (XFLT). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.
Related: XFLT income statement, XFLT balance sheet, XFLT key metrics, XFLT chart. See the XFLT stock overview for the latest quote and news.
XFLT AI stock analysis FAQ
What is XFLT's current dividend yield?
XFLT has an annual forward dividend of $2.70, which equals a dividend yield of 14.83% paid monthly.
What is the analyst price target for XFLT?
The analyst mean price target is $8.00, which is 56.1% below the stock's last close of $18.21.
How much debt does XFLT carry?
As of March 31, 2026, XFLT held total debt of $237.6M and cash of $10.1M, representing net debt of $227.5M and a debt-to-equity ratio of 0.70.
How has XFLT performed compared to the S&P 500?
Over the past year, XFLT delivered a return of -13.0% compared to 16.8% for the S&P 500. Over 5 years, XFLT returned -14.6% versus 83.0% for the S&P 500.