Prospect Capital Corporation (PSEC) Shares Plummet Below 1-Year High

The stock price of Prospect Capital Corporation (NASDAQ: PSEC) has dropped by -0.91 compared to previous close of 5.49. Despite this, the company has seen a fall of -1.63% in its stock price over the last five trading days. Seeking Alpha reported 2024-03-27 that PSEC offers a monthly dividend distribution of $0.06/share that has not grown since 2017. There are better alternative BDCs out there offering superior portfolio investments that have better capitalized on the higher interest rate environment. Interest rates remain a threat to PSEC’s total Net Investment Income. Rate cuts are anticipated in the latter half of 2024 and can result in lower profitability metrics.

Is It Worth Investing in Prospect Capital Corporation (NASDAQ: PSEC) Right Now?

PSEC has 36-month beta value of 0.99. Analysts have mixed views on the stock, with 0 analysts rating it as a “buy,” 0 as “overweight,” 3 as “hold,” and 0 as “sell.”

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The public float for PSEC is 304.24M, and currently, short sellers hold a 7.22% ratio of that float. The average trading volume of PSEC on April 03, 2024 was 2.24M shares.

PSEC’s Market Performance

The stock of Prospect Capital Corporation (PSEC) has seen a -1.63% decrease in the past week, with a -1.09% drop in the past month, and a -9.18% fall in the past quarter. The volatility ratio for the week is 1.19%, and the volatility levels for the past 30 days are at 1.57% for PSEC. The simple moving average for the last 20 days is -0.97% for PSEC’s stock, with a simple moving average of -8.29% for the last 200 days.

Analysts’ Opinion of PSEC

Wells Fargo, on the other hand, stated in their research note that they expect to see PSEC reach a price target of $4.50. The rating they have provided for PSEC stocks is “Underweight” according to the report published on June 25th, 2020.

PSEC Trading at -4.11% from the 50-Day Moving Average

After a stumble in the market that brought PSEC to its low price for the period of the last 52 weeks, the company was unable to rebound, for now settling with -22.17% of loss for the given period.

Volatility was left at 1.57%, however, over the last 30 days, the volatility rate increased by 1.19%, as shares sank -1.09% for the moving average over the last 20 days. Over the last 50 days, in opposition, the stock is trading -10.38% lower at present.

During the last 5 trading sessions, PSEC fell by -1.63%, which changed the moving average for the period of 200-days by -12.68% in comparison to the 20-day moving average, which settled at $5.49. In addition, Prospect Capital Corporation saw -9.18% in overturn over a single year, with a tendency to cut further losses.

Insider Trading

Reports are indicating that there were more than several insider trading activities at PSEC starting from Van Dask Kristin Lea, who purchase 5,000 shares at the price of $5.44 back on Mar 11 ’24. After this action, Van Dask Kristin Lea now owns 10,000 shares of Prospect Capital Corporation, valued at $27,200 using the latest closing price.

Eliasek M Grier, the Chief Operating Officer of Prospect Capital Corporation, purchase 10,000 shares at $5.67 during a trade that took place back on Dec 06 ’23, which means that Eliasek M Grier is holding 1,616,130 shares at $56,700 based on the most recent closing price.

Stock Fundamentals for PSEC

Current profitability levels for the company are sitting at:

  • 0.27 for the present operating margin
  • 0.01 for the gross margin

The net margin for Prospect Capital Corporation stands at 0.02. The total capital return value is set at 0.02.

Based on Prospect Capital Corporation (PSEC), the company’s capital structure generated 0.42 points at debt to capital in total, while cash flow to debt ratio is standing at 0.06. The debt to equity ratio resting at 0.71. The interest coverage ratio of the stock is 0.8.

Currently, EBITDA for the company is -101.64 million with net debt to EBITDA at 19.41. When we switch over and look at the enterprise to sales, we see a ratio of 10.22. The receivables turnover for the company is 12.14for trailing twelve months and the total asset turnover is 0.06.

Conclusion

To put it simply, Prospect Capital Corporation (PSEC) has had a bad performance in recent times. Analysts have a mixed opinion on the stock, with some rating it as a “buy” and others as a “hold”. It’s important to note that the stock is currently trading at a significant distance from its 50-day moving average and its 52-week high.

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