Prospect Capital (NASDAQ:PSEC) Stock Price Up 5.5% After Insider Buying Activity

Key Points

• Shares of Prospect Capital Corporation (NASDAQ:PSEC) increased by 5.5% following significant insider buying, with CEO John F. Barry purchasing 925,000 shares at an average price of $2.72 per share.
• The company recently announced a monthly dividend of $0.045, with a high annualized dividend yield of 19.3%, demonstrating commitment to shareholder returns.
• Prospect Capital's stock has been rated with an average of “Sell” by analysts, with a revised price target of $2.50 from Wells Fargo & Company.

Shares of Prospect Capital Corporation (NASDAQ:PSEC - Get Free Report) traded up 5.5% during trading on Tuesday following insider buying activity. The company traded as high as $2.79 and last traded at $2.79. 1,272,274 shares were traded during mid-day trading, a decline of 60% from the average session volume of 3,210,324 shares. The stock had previously closed at $2.64.

Specifically, CEO John F. Barry bought 925,000 shares of the company's stock in a transaction on Thursday, September 25th. The shares were bought at an average cost of $2.72 per share, with a total value of $2,516,000.00. Following the completion of the acquisition, the chief executive officer owned 86,067,158 shares of the company's stock, valued at approximately $234,102,669.76. This trade represents a 1.09% increase in their ownership of the stock. The acquisition was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, COO M Grier Eliasek bought 370,000 shares of the business's stock in a transaction on Thursday, September 25th. The stock was acquired at an average cost of $2.71 per share, for a total transaction of $1,002,700.00. Following the acquisition, the chief operating officer directly owned 2,501,130 shares of the company's stock, valued at $6,778,062.30. The trade was a 17.36% increase in their ownership of the stock. The disclosure for this purchase can be found here. In related news, CEO John F. Barry bought 741,158 shares of the stock in a transaction dated Wednesday, September 24th. The stock was bought at an average cost of $2.62 per share, with a total value of $1,941,833.96. Following the completion of the acquisition, the chief executive officer owned 85,142,158 shares of the company's stock, valued at $223,072,453.96. This trade represents a 0.88% increase in their ownership of the stock. The purchase was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this hyperlink.

Wall Street Analyst Weigh In

A number of brokerages recently commented on PSEC. Wall Street Zen upgraded Prospect Capital from a "sell" rating to a "hold" rating in a research note on Friday. Wells Fargo & Company cut their price objective on shares of Prospect Capital from $3.00 to $2.50 and set an "underweight" rating on the stock in a research report on Thursday, August 28th. One analyst has rated the stock with a Sell rating, According to data from MarketBeat, the company presently has an average rating of "Sell" and an average target price of $2.50.

Prospect Capital Stock Performance

The stock has a market cap of $1.30 billion, a price-to-earnings ratio of -2.08 and a beta of 0.85. The company has a debt-to-equity ratio of 0.70, a quick ratio of 1.16 and a current ratio of 1.16. The company's 50 day simple moving average is $2.90 and its 200 day simple moving average is $3.32.

Prospect Capital (NASDAQ:PSEC - Get Free Report) last posted its quarterly earnings data on Tuesday, August 26th. The financial services provider reported $0.17 earnings per share for the quarter, beating the consensus estimate of $0.13 by $0.04. The company had revenue of $166.95 million during the quarter, compared to analyst estimates of $167.08 million. Prospect Capital had a negative net margin of 69.68% and a positive return on equity of 12.14%.

Prospect Capital Dividend Announcement

The company also recently announced a monthly dividend, which will be paid on Tuesday, November 18th. Shareholders of record on Wednesday, October 29th will be issued a $0.045 dividend. This represents a c) annualized dividend and a dividend yield of 19.3%. The ex-dividend date is Wednesday, October 29th. Prospect Capital's dividend payout ratio (DPR) is presently -40.30%.

Institutional Trading of Prospect Capital

Large investors have recently added to or reduced their stakes in the company. Kingstone Capital Partners Texas LLC purchased a new stake in Prospect Capital in the 2nd quarter worth about $75,680,000. Oppenheimer & Co. Inc. acquired a new position in Prospect Capital in the 1st quarter worth about $70,000. Caxton Associates LLP purchased a new stake in shares of Prospect Capital during the 1st quarter worth about $1,517,000. Spire Wealth Management lifted its holdings in shares of Prospect Capital by 22.0% during the 1st quarter. Spire Wealth Management now owns 112,389 shares of the financial services provider's stock valued at $461,000 after buying an additional 20,245 shares during the last quarter. Finally, Private Advisor Group LLC grew its stake in shares of Prospect Capital by 48.0% in the 1st quarter. Private Advisor Group LLC now owns 589,686 shares of the financial services provider's stock valued at $2,418,000 after buying an additional 191,354 shares in the last quarter. 9.06% of the stock is owned by institutional investors and hedge funds.

About Prospect Capital

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.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest and most accurate reporting. This story was reviewed by MarketBeat's editorial team prior to publication. Please send any questions or comments about this story to contact@marketbeat.com.