Institutional Confidence Rises as Short Sellers Retreat from Fidus Investment

A notable shift in sentiment is unfolding around Fidus Investment as 2026 begins. The landscape is characterized by a dual movement: speculative investors are rapidly unwinding bets against the company, while major asset managers are concurrently building significant stakes. This dynamic prompts a closer examination of the changing tides for this business development company (BDC).

In a strong vote of confidence, several institutional heavyweights have recently expanded their positions in Fidus Investment. Leading the charge was Envestnet Asset Management, which boosted its holdings by 22.4% to approximately 440,000 shares. Columbus Macro followed closely, increasing its stake by 21%.

This trend of accumulation was mirrored by other prominent financial institutions:
* Van Eck Associates Corp now holds 903,443 shares, following a 6.7% increase.
* Invesco Ltd. raised its position by 11.5%, bringing its total to 497,921 shares.
* UBS Group AG expanded its holdings by 17.1% to 439,945 shares.

Collectively, institutional investors now control about 28.1% of the company’s outstanding shares, signaling substantial professional interest.

Should investors sell immediately? Or is it worth buying Fidus Investment?

Short Interest Contracts Sharply

Concurrent with this institutional buying, pressure from short sellers has diminished considerably. Data from mid-January shows a pronounced decline in short positions. The number of shares sold short dropped by 22.4% to 125,676. This marks a reduction from the 161,888 shares reported as short at the end of December 2025.

This retreat has compressed the Short Interest Ratio to just 0.6 days. At current trading volumes, this metric implies short sellers would require less than a single trading session to cover all their positions. With only 0.3% of the float currently bet against the company, downward speculative pressure has eased dramatically.

Valuation, Yield, and Recent Performance

For income-focused investors, the dividend narrative remains compelling. The company pays a quarterly distribution of $0.43 per share, which annualizes to $1.72. At a recent share price of $19.29, this translates to a yield of approximately 8.9%.

Analysts' consensus currently views the stock as a moderate buy. Their average price target stands at $21.75, suggesting potential upside from current levels. The company's latest operational update presented a mixed picture. For the third quarter of 2025, earnings per share met expectations precisely at $0.50. Revenue, however, came in at $37.25 million, slightly below analyst forecasts. Market participants will be watching future reports closely to see if revenue growth can regain momentum, providing a firmer foundation for the substantial dividend payout over the long term.