Prospect Capital Corporation (NASDAQ:PSEC) Declares Monthly Dividend of $0.04

Key Points

• Prospect Capital declared a monthly dividend of $0.035 per share ($0.42 annualized), representing a reported yield of 29.5%. Shareholders of record January 27 are scheduled to receive it February 17.
• The dividend may be difficult to sustain: analysts forecast next-year earnings of $0.35 per share, below the $0.42 annual dividend, implying a projected payout ratio of 120%.
• For its latest quarter, Prospect Capital reported EPS of $0.15, beating the $0.10 consensus estimate, but revenue of $151.74 million fell short of the $163.14 million estimate.

Prospect Capital Corporation (NASDAQ:PSEC - Get Free Report) declared a monthly dividend on Wednesday, November 4th. Shareholders of record on Wednesday, January 27th will be given a dividend of $0.0350 per share by the financial services provider on Wednesday, February 17th. This represents a $0.42 dividend on an annualized basis and a dividend yield of 29.5%. The ex-dividend date of this dividend is Wednesday, January 27th.

Prospect Capital has decreased its dividend by an average of 0.1% annually over the last three years. Prospect Capital has a payout ratio of 89.4% indicating that its dividend is currently covered by earnings, but may not be in the future if the company's earnings fall. Analysts expect Prospect Capital to earn $0.35 per share next year, which means the company may not be able to cover its $0.42 annual dividend with an expected future payout ratio of 120.0%.

Prospect Capital Stock Performance

Shares of PSEC stock traded down $0.01 on Thursday, hitting $1.43. The company had a trading volume of 5,275,880 shares, compared to its average volume of 5,117,919. Prospect Capital has a twelve month low of $1.40 and a twelve month high of $3.12. The company has a quick ratio of 0.87, a current ratio of 0.87 and a debt-to-equity ratio of 0.64. The firm has a market cap of $760.69 million, a P/E ratio of 28.50 and a beta of 0.84. The company has a 50-day moving average price of $1.93 and a 200-day moving average price of $2.35.

Prospect Capital (NASDAQ:PSEC - Get Free Report) last posted its earnings results on Wednesday, November 4th. The financial services provider reported $0.15 EPS for the quarter, topping the consensus estimate of $0.10 by $0.05. The firm had revenue of $151.74 million for the quarter, compared to analyst estimates of $163.14 million. Prospect Capital had a return on equity of 12.15% and a net margin of 19.33%. As a group, equities research analysts predict that Prospect Capital will post 0.38 earnings per share for the current fiscal year.

Insider Buying and Selling at Prospect Capital

In other Prospect Capital news, CEO John Barry. III bought 1,217,105 shares of Prospect Capital stock in a transaction dated Friday, September 4th. The stock was acquired at an average cost of $2.24 per share, with a total value of $2,726,315.20. Following the purchase, the chief executive officer directly owned 90,479,988 shares in the company, valued at $202,675,173.12. This represents a 1.36% increase in their position. The acquisition was disclosed in a filing with the SEC, which is available through the SEC website. 25.94% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On Prospect Capital

A number of large investors have recently modified their holdings of PSEC. Integrity Advisory Solutions LLC acquired a new stake in shares of Prospect Capital in the third quarter valued at about $29,000. WINTON GROUP Ltd acquired a new position in Prospect Capital during the second quarter worth about $35,000. Caitong International Asset Management Co. Ltd boosted its position in Prospect Capital by 55.5% during the second quarter. Caitong International Asset Management Co. Ltd now owns 16,970 shares of the financial services provider's stock worth $39,000 after acquiring an additional 6,056 shares during the last quarter. ARS Wealth Advisors Group LLC acquired a new position in Prospect Capital during the third quarter worth about $36,000. Finally, GTS Securities LLC purchased a new stake in Prospect Capital during the 2nd quarter valued at about $40,000. Hedge funds and other institutional investors own 9.06% of the company's stock.

Prospect Capital Company Profile

Prospect Capital Corporation NASDAQ: PSEC is a business development company that provides financing and investment capital to middle-market companies. The company primarily invests in privately held businesses through first-lien and second-lien loans, mezzanine debt, and other debt securities, while also making equity and equity-related investments in selected companies.

Prospect Capital invests across a range of industries and has additional exposure to areas such as real estate, structured credit, and financial services.

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