PSEC Stock Analysis: Prospect Capital | NASDAQ
Asset Management | NASDAQ, USA | Market Cap: 1.030m USD | 12M Return: -20% | US74348T1025 | Charts, Fundamentals & Technical Analysis
Avg Turnover: 9.51M
EPS Trend: -99.1%
Qual. Beats: 10
Qual. Beats: 0
Warnings
Tailwinds
No distinct edge detected
Seasonality 11.7 years of data
How good or bad each month usually is (without trend). The score below shows how much you can trust it: 0 = pure chance, >40 gets interesting and >55 is strong.
Prospect Capital Corporation (PSEC) is a Business Development Company (BDC) that operates as a private equity and private debt investor, primarily targeting middle-market and lower-middle-market companies. The firm provides a range of financing solutions including senior debt, unitranche loans, mezzanine debt, first-lien and second-lien positions, subordinated debt tranches of CLOs, bridge loans, and minority equity investments. It also makes real estate investments focused on multi-family residential properties.
PSEC invests across a broad set of industries-including aerospace and defense, chemicals, healthcare, software, energy, manufacturing, and consumer services-with particular expertise in the energy and industrial sectors. Geographically, the fund concentrates on opportunities in the United States and Canada, typically committing between $10 million and $500 million per transaction. It favors small to medium-sized private companies over large public issuers.
As a BDC, Prospect Capital operates under a regulatory framework established by Congress in 1980 that requires it to distribute the majority of its taxable income to shareholders, making it one of the higher-yielding equity instruments in the asset management and custody banking sub-industry. The companys strategy combines primary loan origination with secondary market purchases, and it frequently partners with private equity sponsors on acquisitions, recapitalizations, and growth financings.
- Net investment income fails to cover dividend amid rate volatility
- Energy portfolio non-accruals climb on weakening oil prices
- Private credit competition compresses yields on new middle market originations
| Net Income: 153.7m TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.06 > 0.02 and ΔFCF/TA -1.85 > 1.0 |
| NWC/Revenue: -52.44% < 20% (prev 16.60%; Δ -69.04% < -1%) |
| CFO/TA 0.06 > 3% & CFO 376.3m > Net Income 153.7m |
| Net Debt (1.82b) to EBITDA (341.4m): 5.32 < 3 |
| Current Ratio: 0.11 > 1.5 & < 3 |
| Outstanding Shares: last quarter (479.9m) vs 12m ago 5.26% < -2% |
| Gross Margin: 79.69% > 18% (prev 147.0%; Δ -67.31% > 0.5%) |
| Asset Turnover: 9.65% > 50% (prev -4.07%; Δ 13.72% > 0%) |
| Interest Coverage Ratio: 2.51 > 6 (EBIT TTM 326.4m / Interest Expense TTM 129.9m) |
| A: -0.05 (Total Current Assets 43.6m - Total Current Liabilities 378.9m) / Total Assets 6.45b |
| B: -0.22 (Retained Earnings -1.39b / Total Assets 6.45b) |
| C: 0.05 (EBIT TTM 326.4m / Avg Total Assets 6.63b) |
| D: 2.31 (Book Value of Equity 4.50b / Total Liabilities 1.95b) |
| Altman-Z'' = 1.72 = BBB |
As of October 07, 2026, the stock is trading at USD 1.83 with a total of 13,615,500 shares traded. Over the past week, the price has changed by -13.68%, over one month by -15.08%, over three months by -12.80% and over the past year by -19.97%.
Current recommended Stop Loss: 1.70 (which is 7.1% or 2.2 ATR below the current price).
Prospect Capital has received a consensus analysts rating of 1.00. Therefore, it is recommended to sell PSEC.
- StrongBuy: 0
- Buy: 0
- Hold: 0
- Sell: 0
- StrongSell: 1
| Analysts Target Price | 2 | 9.3% |
P/E Trailing = 32.1667
P/E Forward = 9.3721
P/S = 1.6112
P/B = 0.3942
P/EG = 1.5483
Revenue TTM = 639.5m USD
EBIT TTM = 326.4m USD
EBITDA TTM = 341.4m USD
Long Term Debt = 1.48b USD (estimated: total debt 1.86b - short term 378.9m)
Short Term Debt = 378.9m USD (from shortTermDebt, last quarter)
Debt = 1.86b USD (from shortLongTermDebtTotal, last quarter)
Net Debt = 1.82b USD (calculated: Debt 1.86b - CCE 43.6m)
Enterprise Value = 2.85b USD (1.03b + Debt 1.86b - CCE 43.6m)
Interest Coverage Ratio = 2.51 (Ebit TTM 326.4m / Interest Expense TTM 129.9m)
EV/FCF = 7.57x (Enterprise Value 2.85b / FCF TTM 376.3m)
FCF Yield = 13.22% (FCF TTM 376.3m / Enterprise Value 2.85b)
FCF Margin = 58.85% (FCF TTM 376.3m / Revenue TTM 639.5m)
Net Margin = 24.03% (Net Income TTM 153.7m / Revenue TTM 639.5m)
Gross Margin = 79.69% ((Revenue TTM 639.5m - Cost of Revenue TTM 129.9m) / Revenue TTM)
Gross Margin QoQ = 90.35% (prev 50.94%)
Tobins Q-Ratio = 0.44 (Enterprise Value 2.85b / Total Assets 6.45b)
Interest Expense / Debt = 6.98% (Interest Expense 129.9m / Debt 1.86b)
Taxrate = 21.0% (US federal default 21%)
NOPAT = 257.8m (EBIT 326.4m * (1 - 21.00%))
Current Ratio = 0.11 (Total Current Assets 43.6m / Total Current Liabilities 378.9m)
Debt / Equity = 0.41 (Debt 1.86b / totalStockholderEquity, last quarter 4.50b)
Debt / EBITDA = 5.32 (Net Debt 1.82b / EBITDA 341.4m)
Debt / FCF = 4.83 (Net Debt 1.82b / FCF TTM 376.3m)
Total Stockholder Equity = 3.76b (last 4 quarters mean from totalStockholderEquity)
RoA = 2.32% (Net Income 153.7m / Total Assets 6.45b)
RoE = 4.09% (Net Income TTM 153.7m / Total Stockholder Equity 3.76b)
RoCE = 6.23% (EBIT 326.4m / Capital Employed (Equity 3.76b + L.T.Debt 1.48b))
RoIC = 4.02% (NOPAT 257.8m / Invested Capital 6.42b)
WACC = 6.35% (E(1.03b)/V(2.89b) * Re(7.85%) + D(1.86b)/V(2.89b) * Rd(6.98%) * (1-Tc(0.21)))
Discount Rate = 7.85% (= CAPM, Blume Beta Adj.)
Shares (quarterly) Correlation: 95.24 | Cagr: 6.34%
[DCF] Terminal Value 73.10% ; FCFF base≈435.1m ; Y1≈381.5m ; Y5≈308.3m
[DCF] Fair Price = 5.87 (EV 4.95b - Net Debt 1.82b = Equity 3.13b / Shares 533.8m; r=8.35% [WACC [floored]]; 5y FCF grow -15.0% → 2.50% )
EPS Correlation: -99.05 | EPS CAGR: -18.71% | SUE: 2.40 | # QB: 10
Revenue Correlation: N/A | Revenue CAGR: N/A | SUE: 0.02 | # QB: 0
EPS current Quarter (2026-09-30): EPS=0.10 | Chg30d=+0.00% | Revisions=-25% | Analysts=1
EPS next Quarter (2026-12-31): EPS=0.10 | Chg30d=+11.11% | Revisions=+25% | Analysts=1
EPS current Year (2027-06-30): EPS=0.38 | Chg30d=+8.57% | Revisions=+25% | GrowthEPS=-44.1% | GrowthRev=-2.9%
EPS next Year (2028-06-30): EPS=0.35 | Chg30d=+9.37% | Revisions=+25% | GrowthEPS=-7.9% | GrowthRev=-1.8%