Prospect Capital Corporation (NASDAQ:PSEC) Shares Set to Pay Monthly Dividend of $0.04

Key Points

• Prospect Capital declared a monthly dividend of $0.035 per share ($0.42 annualized), with a stated yield of 29.5%; it is payable December 21 to shareholders of record November 25.
• The dividend may be difficult to sustain: analysts expect $0.35 in EPS next year, below the $0.42 annual dividend, implying a projected payout ratio of 120%.
• Quarterly EPS of $0.15 beat the $0.10 consensus, but revenue missed expectations, and net investment income and NII per share declined from a year earlier.

Prospect Capital Corporation (NASDAQ:PSEC - Get Free Report) announced a monthly dividend on Wednesday, November 4th. Investors of record on Wednesday, November 25th will be paid a dividend of $0.0350 per share by the financial services provider on Monday, December 21st. This represents a $0.42 annualized dividend and a dividend yield of 29.5%. The ex-dividend date is Wednesday, November 25th.

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. Equities 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

NASDAQ:PSEC traded down $0.01 during midday trading on Thursday, reaching $1.43. 5,275,880 shares of the company traded hands, compared to its average volume of 5,117,919. The firm has a market capitalization of $760.69 million, a price-to-earnings ratio of 28.50 and a beta of 0.84. The company has a fifty day moving average price of $1.93 and a 200 day moving average price of $2.35. The company has a debt-to-equity ratio of 0.64, a current ratio of 0.87 and a quick ratio of 0.87. Prospect Capital has a twelve month low of $1.40 and a twelve month high of $3.12.

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

More Prospect Capital News

Here are the key news stories impacting Prospect Capital this week:

• Positive Sentiment: PSEC reported $0.15 per share, above the $0.10 analyst consensus, and announced a $200 million common-share repurchase program. Repurchases could support per-share value, though the announcement does not establish how much the company will buy back. Prospect Capital results and repurchase program
• Neutral Sentiment: Call-option trading rose to 2,565 contracts, 353% above its average volume. This suggests increased speculative interest, but options activity alone does not reliably predict the stock’s direction.
• Negative Sentiment: Quarterly revenue of $151.7 million fell short of the $163.1 million consensus. Net investment income was $76.4 million, down from $79.4 million a year earlier, while NII per share declined to $0.15 from $0.17. The earnings beat therefore came alongside weaker underlying income. Prospect Capital earnings report
• Negative Sentiment: An Associated Press earnings snapshot reported a $21 million net loss, highlighting that the per-share earnings beat does not mean the company was profitable on a net basis. Fiscal Q1 earnings snapshot
• Negative Sentiment: A Seeking Alpha article raised concerns about PSEC’s high stated yield being supported by a shrinking portfolio, adding to questions about the sustainability of income and distributions. Analysis of Prospect Capital’s yield and portfolio

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.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.