Highlights were for me.....
H and m is oil and gas property that will be sold and reason it was npl is higher drilling etc which if they selling property it's right thing to do and show. So psec will get money and then some
spreads widening which is positive for all bdc s
Next qtr you get very close to covering dividend with nii. However gains on equity etc we already covering
Mgt did drone on alot and the call could have been ten minutes not 45.
Great discount to nav and 14 percent yield as getting closer to covering div with nii to me it's a buy
Management continues to trade stock price for their fee income, the stock repurchase plan is completely bogus as was the disengenuous notion shared on the call that the stock had fallen in to " I think the low 8's". How tranparent can they be, as they bought no shares with the last 20 million dollar plan that this 100 million dollar plan, they have little credibility as well as their far to frequent stock offerings indicate, they will likely continue to sell out current shareholders for higher fee income.
So long as PSEC can keep NII fairly close to the dividend payout, the dividend payout should be able to continue as a very slow increase. We'll see how close they come this current quarter, in a couple of months or so. Any extra loan/closing fees during the quarter and gains on sales would help.
Listened to conf call this AM. A long call, but I appreciated the straightforward, intelligent discussions. Very patient and thorough with many questioners. Especially the lawyer who had owned the stock since 2004 who, after about 10 minutes of arguing, admitted that he was pretty happy with the dividend stream over those years.
Used baseball analogy to describe investment strategy: "lots of singles with a few doubles and triples and once in a while a home run." Avoid risky investments. 30 cents divyy safely covered by profits this quarter. Expect to raise divvy in the future. CEO used to run marathons, quoted Buffet several times: investing with a longer term 5 or ten year window in solid companies.
I think PSEC is a good place to park my money and let it earn 14% for a while. If share price drops, I'll buy more and raise my interest rate.
Some folks who are griping on this message board must be day traders. If you are one of those, you need to go find another stock to buy.
>> spreads widening which is positive for all bdc s
How could they frame widening spread as a positive? Widening spread is the market's way of pricing in higher default risk. It also means the principal value of existing loans are more likely to be written down (i.e., increased unrealized depreciation expense).
They getting better terms on new originations
Not saying loan portfolio risk is going up. On existing they said overall revs and profits are up nicely albeit would rather a stat given like pnnt saying ebitda is 3x interest expense for portfolio
Certainly rather better spreads on new origination than getting squeezed
Either way all bdc need strong due diligence for deals they do.
The market being so unpredictable right now, PSEC is a fine place to park my money and get 13%.
Divvy is covered til Dec and will likely go up after that.
I've been following today's price action today on Level II. Looks like some fund has its machines running both the bid and ask sides to keep the price in a narrow range. Ex divvy yesterday so methinks they are doing their best to keep the price down and scarf up cheap shares.
Waiting for the conf call to be archived so I can listen.