Prospect Capital (NASDAQ:PSEC) was upgraded by Zacks from a “sell” rating to a “hold” rating in a research report issued on Monday.
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. “
A number of other firms have also recently commented on PSEC. Analysts at MLV & Co. reiterated a “buy” rating and set a $9.00 price target (down previously from $10.50) on shares of Prospect Capital in a research note on Sunday, May 10th. Separately, analysts at Barclays lowered their price target on shares of Prospect Capital from $11.00 to $10.00 and set an “equal weight” rating on the stock in a research note on Friday, May 8th. Five research analysts have rated the stock with a hold rating and four have assigned a buy rating to the stock. The stock presently has a consensus rating of “Hold” and a consensus target price of $10.21.
The street knows that management is spinning off these new companies, to increase fees, under the banner of "unlocking shareholder value".
They cannot do OPTION A because the stopped public offerings at below NAV. WHich is good for us stock holders. So no new money ..no initiations
many like AGNC have cut DIV by a small amount so investors selling going on. I can handle some selling, but at $0.10 to $0.20 per day. I will take a few months to get back the lost capital from here.
Is there any way that Shareholders (the owners of PSEC) can force management to change - to build value instead of inriching their fees??
Thanks. It appear that Management is spinning off higher risk CLO's before the impact of lower oil and .. other slow economic businesses hit. Appears they are boarding up the windows before the storm. Higher quality loans come with less yield, so the yield was cut. But hopefully loan losses are cut also.
At least they STOPPED selling shares at market price below BOOK. They should be buying shares now that market price is below book. Sell shares when market is above book, to gain both ways.
PSEC has announced that it is spinning off its CLO investments and has already sold some of the smaller ones including:
“"On October 3, 2014, we sold our $35,000 investment in Babson CLO Ltd. 2011-I and realized a loss on the sale. On October 20, 2014, we sold our $22,000 investment in Galaxy XII CLO, Ltd. and realized a loss on the sale. On December 4, 2014, we sold our $27.8 million investment in Babson CLO Ltd. 2012-II and realized a loss on the sale. On December 4, 2014, we sold our $29.1 million investment in Babson CLO Ltd. 2012-I and realized a loss on the sale."
It is important to note that some of the CLOs that were sold had been written down so the impact to net asset value ("NAV") per share might be minimal.