The ratio of debt to operating expenses for Prospect Capital Corp is higher than it is for about 98.68% of US stocks.
In terms of twelve month growth in earnings before interest and taxes, Prospect Capital Corp is reporting a growth rate of -96.43%; that's higher than only 17.18% of US stocks.
Prospect Capital Corp's shareholder yield -- a measure of how much capital is returned to stockholders via dividends and buybacks -- is 24.36%, greater than the shareholder yield of 90.07% of stocks in our set.
Stocks that are quantitatively similar to PSEC, based on their financial statements, market capitalization, and price volatility, are ASR, FDUS, LNC, TCPC, and AINV.
Prospect Capital Corporation invests primarily in first and second lien secured loans and unsecured debt, senior and subordinated debt and equity of companies in need of capital for acquisitions, divestitures, growth, development, recapitalizations and other purposes. The company was founded in 1988 and is based in New York, New York.
PSEC Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Prospect Capital Corp. To summarize, we found that Prospect Capital Corp ranked in the 83th percentile in terms of potential gain offered. More precisely, our analysis suggests the stock is undervalued by approximately 671% on a DCF basis. As for the metrics that stood out in our discounted cash flow analysis of Prospect Capital Corp, consider:
Prospect Capital Corp's effective tax rate, as measured by taxes paid relative to net income, is at 0 -- greater than merely 0% of US stocks with positive free cash flow.
Prospect Capital Corp's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at 0.09. This coverage rate is greater than that of only 23.62% of stocks we're observing for the purpose of forecasting via discounted cash flows.
The weighted average cost of capital for the company is 14. This value is greater than 91.52% stocks in the Financial Services sector that generate free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Financial Services that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as PSEC, try FOCS, TCRD, AEL, EV, and ESNT.
We at Insider Monkey have gone over 821 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds' and investors' portfolio positions as of March 31st, near the height of the coronavirus market crash. In this article, we look at what those funds think […]