Prospect Capital (PSEC) Raised to “Buy” at Zacks Investment Research

Zacks Investment Research upgraded shares of Prospect Capital (NASDAQ:PSEC) from a hold rating to a buy rating in a research note issued to investors on Wednesday morning. Zacks Investment Research currently has $7.75 price target on the financial services provider’s stock.

According to Zacks, “Prospect Capital Corporation is a closed-end investment company that lends to and invests in private and microcap public businesses. Prospect Capital’s investment objective is to generate both current income and capital appreciation through debt and equity investments. “

PSEC has been the topic of a number of other research reports. National Securities dropped their target price on Prospect Capital from $5.00 to $4.00 and set a sell rating on the stock in a report on Tuesday, November 14th. BMO Capital Markets dropped their target price on Prospect Capital from $7.00 to $6.00 and set a market perform rating on the stock in a report on Friday, November 10th. ValuEngine upgraded Prospect Capital from a buy rating to a strong-buy rating in a report on Friday, December 22nd. BidaskClub lowered Prospect Capital from a buy rating to a hold rating in a report on Thursday, January 4th. Finally, TheStreet lowered Prospect Capital from a b- rating to a c+ rating in a report on Wednesday, September 27th. One research analyst has rated the stock with a sell rating, five have assigned a hold rating, one has assigned a buy rating and one has given a strong buy rating to the company. The company currently has a consensus rating of Hold and a consensus target price of $6.81.

Prospect Capital (NASDAQ PSEC) traded down $0.01 during mid-day trading on Wednesday, hitting $6.80. The stock had a trading volume of 1,792,702 shares, compared to its average volume of 2,670,000. Prospect Capital has a 52 week low of $5.51 and a 52 week high of $9.58. The company has a quick ratio of 2.63, a current ratio of 2.63 and a debt-to-equity ratio of 0.78. The company has a market capitalization of $2,450.00, a price-to-earnings ratio of 13.33 and a beta of 0.56.

Prospect Capital (NASDAQ:PSEC) last posted its earnings results on Wednesday, November 8th. The financial services provider reported $0.18 earnings per share for the quarter, missing the Zacks’ consensus estimate of $0.19 by ($0.01). Prospect Capital had a net margin of 27.00% and a return on equity of 8.63%. The company had revenue of $158.58 million during the quarter, compared to the consensus estimate of $161.00 million. During the same quarter in the prior year, the business earned $0.22 EPS. The firm’s revenue for the quarter was down 11.8% compared to the same quarter last year. research analysts expect that Prospect Capital will post 0.72 EPS for the current year.

The firm also recently declared a monthly dividend, which will be paid on Thursday, February 15th. Investors of record on Wednesday, January 31st will be given a dividend of $0.06 per share. This represents a $0.72 dividend on an annualized basis and a dividend yield of 10.59%. The ex-dividend date of this dividend is Tuesday, January 30th. Prospect Capital’s payout ratio is 141.18%.

In other Prospect Capital news, COO M Grier Eliasek purchased 10,000 shares of the firm’s stock in a transaction that occurred on Friday, December 22nd. The stock was bought at an average cost of $7.19 per share, with a total value of $71,900.00. Following the completion of the transaction, the chief operating officer now owns 1,202,196 shares of the company’s stock, valued at approximately $8,643,789.24. The purchase was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, CFO Brian H. Oswald purchased 35,000 shares of the firm’s stock in a transaction that occurred on Friday, November 10th. The shares were acquired at an average cost of $5.75 per share, with a total value of $201,250.00. The disclosure for this purchase can be found here. Insiders have purchased 4,604,521 shares of company stock valued at $31,784,051 over the last ninety days. 7.10% of the stock is currently owned by company insiders.

Several institutional investors and hedge funds have recently modified their holdings of PSEC. Arrowstreet Capital Limited Partnership purchased a new stake in shares of Prospect Capital during the second quarter valued at approximately $7,697,000. Penn Mutual Life Insurance Co purchased a new stake in shares of Prospect Capital during the third quarter valued at approximately $3,992,000. Cowen Inc. increased its position in shares of Prospect Capital by 200.0% during the third quarter. Cowen Inc. now owns 248,000 shares of the financial services provider’s stock valued at $1,667,000 after acquiring an additional 496,000 shares during the last quarter. Van ECK Associates Corp increased its position in shares of Prospect Capital by 21.6% during the second quarter. Van ECK Associates Corp now owns 2,307,637 shares of the financial services provider’s stock valued at $18,738,000 after acquiring an additional 410,614 shares during the last quarter. Finally, Engineers Gate Manager LP purchased a new stake in shares of Prospect Capital during the third quarter valued at approximately $1,385,000. 15.60% of the stock is owned by institutional investors.

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About Prospect Capital

Prospect Capital Corporation is a financial services company. The Company primarily lends to and invests in middle market privately held companies. The Company is a closed-end investment company. Its investment objective is to generate both current income and long-term capital appreciation through debt and equity investments.

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