PSEC Stock Analysis: Prospect Capital | NASDAQ
Asset Management | NASDAQ, USA | Market Cap: 1.144m USD | 12M Return: -2.4% | US74348T1025 | Charts, Fundamentals & Technical Analysis
Avg Turnover: 8.23M
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 provides debt and equity financing to small and middle-market private companies, with particular expertise in the energy and industrial sectors. The firm specializes in mezzanine finance, senior secured loans, unitranche structures, first-lien and second-lien debt, private equity investments, and also holds a portfolio of multi-family residential real estate assets.
PSEC pursues both primary origination and secondary market purchases, targeting transactions typically ranging from $10 million to $500 million in companies with EBITDA between $5 million and $150 million. As a BDC, the company operates under the regulatory framework of the Investment Company Act of 1940, which generally requires it to distribute the bulk of its taxable income to shareholders-a structure that makes such vehicles common holdings for income-oriented investors.
The company invests across a wide range of industries, including aerospace and defense, healthcare, software, oil and gas, financial services, manufacturing, consumer products, and renewables, with a geographic focus on the United States and Canada. Its portfolio activity centers on acquisitions, leveraged buyouts, recapitalizations, growth capital, bridge loans, and debt financings for private equity sponsors, primarily in companies that are too small to access public capital markets efficiently.
- Net investment income pressured by base rate movements
- Energy sector non-accruals drag on portfolio credit performance
- Dividend coverage challenged as NAV per share erodes further
| 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 September 27, 2026, the stock is trading at USD 2.19 with a total of 5,100,643 shares traded. Over the past week, the price has changed by +0.46%, over one month by -5.38%, over three months by +1.08% and over the past year by -2.43%.
Current recommended Stop Loss: 2.10 (which is 4.1% or 1.8 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 | -8.7% |
P/E Trailing = 36.3333
P/E Forward = 9.3721
P/S = 1.7892
P/B = 0.3906
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 = 2.96b USD (1.14b + Debt 1.86b - CCE 43.6m)
Interest Coverage Ratio = 2.51 (Ebit TTM 326.4m / Interest Expense TTM 129.9m)
EV/FCF = 7.87x (Enterprise Value 2.96b / FCF TTM 376.3m)
FCF Yield = 12.71% (FCF TTM 376.3m / Enterprise Value 2.96b)
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 = 0.46 (Enterprise Value 2.96b / 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 = 6.48% (E(1.14b)/V(3.00b) * Re(8.04%) + D(1.86b)/V(3.00b) * Rd(6.98%) * (1-Tc(0.21)))
Discount Rate = 8.04% (= 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 = 5.97 (EV 4.95b - Net Debt 1.82b = Equity 3.13b / Shares 524.8m; 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%