NasdaqGS:PSEC

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Executive Summary

Prospect Capital Corporation is a business development company.

Rewards


Snowflake Analysis


Similar Companies

Share Price & News

How has Prospect Capital's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: PSEC's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

7.5%

PSEC

7.1%

US Capital Markets

3.8%

US Market


1 Year Return

-16.3%

PSEC

9.8%

US Capital Markets

9.7%

US Market

Return vs Industry: PSEC underperformed the US Capital Markets industry which returned 9% over the past year.

Return vs Market: PSEC underperformed the US Market which returned 8.9% over the past year.


Shareholder returns

PSECIndustryMarket
7 Day7.5%7.1%3.8%
30 Day34.9%16.4%11.4%
90 Day-1.6%10.7%6.8%
1 Year-5.4%-16.3%12.0%9.8%12.1%9.7%
3 Year-4.2%-31.9%32.4%24.7%36.2%27.2%
5 Year30.7%-28.1%59.9%44.8%63.7%45.4%

Price Volatility Vs. Market

How volatile is Prospect Capital's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Prospect Capital undervalued compared to its fair value and its price relative to the market?

0.68x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: PSEC ($5.45) is trading above our estimate of fair value ($5.01)

Significantly Below Fair Value: PSEC is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: PSEC is unprofitable, so we can't compare its PE Ratio to the Capital Markets industry average.

PE vs Market: PSEC is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate PSEC's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: PSEC is good value based on its PB Ratio (0.7x) compared to the US Capital Markets industry average (9.1x).

Future Growth

How is Prospect Capital forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

200.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PSEC is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (2.2%).

Earnings vs Market: PSEC is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: PSEC's is expected to become profitable in the next 3 years.

Revenue vs Market: PSEC's revenue is expected to decline over the next 3 years (-3.4% per year).

High Growth Revenue: PSEC's revenue is forecast to decline over the next 3 years (-3.4% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if PSEC's Return on Equity is forecast to be high in 3 years time

Past Performance

How has Prospect Capital performed over the past 5 years?

-15.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PSEC is currently unprofitable.

Growing Profit Margin: PSEC is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: PSEC is unprofitable, and losses have increased over the past 5 years at a rate of -15.3% per year.

Accelerating Growth: Unable to compare PSEC's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: PSEC is unprofitable, making it difficult to compare its past year earnings growth to the Capital Markets industry (16.6%).


Return on Equity

High ROE: PSEC has a negative Return on Equity (-4.77%), as it is currently unprofitable.

Financial Health

How is Prospect Capital's financial position?


Financial Position Analysis

Short Term Liabilities: PSEC's short term assets ($63.4M) do not cover its short term liabilities ($226.9M).

Long Term Liabilities: PSEC's short term assets ($63.4M) do not cover its long term liabilities ($2.1B).


Debt to Equity History and Analysis

Debt Level: PSEC's debt to equity ratio (74.5%) is considered high.

Reducing Debt: PSEC's debt to equity ratio has reduced from 80.8% to 74.5% over the past 5 years.

Debt Coverage: PSEC's debt is not well covered by operating cash flow (18.1%).

Interest Coverage: PSEC is unprofitable, therefore interest payments are not well covered by earnings.


Balance Sheet

Dividend

What is Prospect Capital's current dividend yield, its reliability and sustainability?

13.21%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: PSEC's dividend (13.21%) is higher than the bottom 25% of dividend payers in the US market (1.62%).

High Dividend: PSEC's dividend (13.21%) is in the top 25% of dividend payers in the US market (4.32%)


Stability and Growth of Payments

Stable Dividend: PSEC's dividend payments have been volatile in the past 10 years.

Growing Dividend: PSEC's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: PSEC is paying a dividend but the company is unprofitable.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.

Management

How experienced are the management team and are they aligned to shareholders interests?

13.9yrs

Average board tenure


CEO

John Barry (67yo)

16.17yrs

Tenure

Mr. John Francis Barry serves as Chairman and CEO of Pathway Capital Opportunity Fund Management, LLC. Mr. John Francis Barry, III, J.D. serves as the Chief Executive Officer and Chairman of the Board of P ...


Board Members

NamePositionTenureCompensationOwnership
John Barry
Chairman & CEO16.17yrsno data0.053% $1.1m
Michael Eliasek
President16yrsno data0.37% $7.4m
William Gremp
Independent Director10.17yrsUS$150.00k0.0083% $167.7k
Andrew Cooper
Lead Independent Directorno dataUS$150.00kno data
Eugene Stark
Independent Director11.75yrsUS$150.00k0.012% $237.1k
Matt FitzPatrick
Directorno datano datano data
Benjamin Bloom
Directorno datano datano data

13.9yrs

Average Tenure

61yo

Average Age

Experienced Board: PSEC's board of directors are seasoned and experienced ( 13.9 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: PSEC insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Prospect Capital Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Prospect Capital Corporation
  • Ticker: PSEC
  • Exchange: NasdaqGS
  • Founded: 2004
  • Industry: Asset Management and Custody Banks
  • Sector: Diversified Financials
  • Market Cap: US$2.013b
  • Shares outstanding: 369.36m
  • Website: https://www.prospectstreet.com

Location

  • Prospect Capital Corporation
  • 10 East 40th Street
  • 42nd Floor
  • New York
  • New York
  • 10016
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PSECNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJul 2004
RK8DB (Deutsche Boerse AG)YesCommon StockDEEURJul 2004
PSECSWX (SIX Swiss Exchange)YesCommon StockCHCHFJul 2004
0R25LSE (London Stock Exchange)YesCommon StockGBUSDJul 2004

Biography

Prospect Capital Corporation is a business development company. It specializes in middle market, mature, mezzanine finance, later stage, emerging growth, leveraged buyouts, refinancing, acquisitions, recapitalizations, turnaround, growth capital, development, capital expenditures and subordinated debt tranches of collateralized loan obligations, cash flow term loans, market place lending and bridge transactions. It also makes real estate investments particularly in multi-family residential real estate asset class. The fund makes secured debt, senior debt, senior and secured term loans, unitranche debt, first-lien and second lien, private debt, private equity, mezzanine debt, and equity investments in private and microcap public businesses. It focuses on both primary origination and secondary loans/portfolios and invests in situations like debt financings for private equity sponsors, acquisitions, dividend recapitalizations, growth financings, bridge loans, cash flow term loans, real estate financings/investments. It also focuses on investing in small-sized and medium-sized private companies rather than large public companies. The fund typically invests across all industry sectors, with a particular expertise in the energy and industrial sectors. It invests in aerospace and defense, chemicals, conglomerate services, consumer services, ecological, electronics, financial services, machinery, manufacturing, media, pharmaceuticals, retail, software, specialty minerals, textiles and leather, transportation, oil and gas production, coal production, materials, industrials, consumer discretionary, information technology, utilities, pipeline, storage, power generation and distribution, renewable and clean energy, oilfield services, healthcare, food and beverage, education, business services, and other select sectors. It prefers to invest in the United States and Canada. The fund seeks to invest between $10 million to $500 million per transaction in companies with EBITDA between $5 million and $150 million, sales value between $25 million and $500 million, and enterprise value between $5 million and $1000 million. It fund also co-invests for larger deals. The fund seeks control acquisitions by providing multiple levels of the capital structure. The fund focuses on sole, agented, club, or syndicated deals. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/06 02:55
End of Day Share Price2020/06/05 00:00
Earnings2020/03/31
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.