PROSPECT CAPITAL CORP (PSEC) Stock Fundamental Analysis
NASDAQ:PSEC - Nasdaq - US74348T1025 - Common Stock - Currency: USD
We assign a fundamental rating of 3 out of 10 to PSEC. PSEC was compared to 225 industry peers in the Capital Markets industry. There are concerns on the financial health of PSEC while its profitability can be described as average. PSEC has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year PSEC was profitable.
In the past year PSEC had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: PSEC reported negative net income in multiple years.
In multiple years PSEC reported negative operating cash flow during the last 5 years.
1.2 Ratios
The Return On Assets of PSEC (-1.26%) is worse than 81.28% of its industry peers.
The Return On Equity of PSEC (-1.80%) is worse than 79.45% of its industry peers.
PSEC has a Return On Invested Capital (4.14%) which is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for PSEC is below the industry average of 6.82%.
The last Return On Invested Capital (4.14%) for PSEC is above the 3 year average (4.06%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.26% | ||
| ROE | -1.8% | ||
| ROIC | 4.14% |
ROA(3y)2.32%
ROA(5y)4.38%
ROE(3y)3.67%
ROE(5y)6.97%
ROIC(3y)4.06%
ROIC(5y)3.98%
1.3 Margins
PSEC's Profit Margin has declined in the last couple of years.
The Operating Margin of PSEC (46.92%) is better than 83.11% of its industry peers.
PSEC's Operating Margin has improved in the last couple of years.
PSEC has a better Gross Margin (52.94%) than 61.64% of its industry peers.
PSEC's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 46.92% | ||
| PM (TTM) | N/A | ||
| GM | 52.94% |
OM growth 3Y2.53%
OM growth 5Y1.85%
PM growth 3Y-51.74%
PM growth 5Y-3.58%
GM growth 3Y2.62%
GM growth 5Y1.89%
2. Health
2.1 Basic Checks
The number of shares outstanding for PSEC has been increased compared to 1 year ago.
Compared to 5 years ago, PSEC has more shares outstanding
The debt/assets ratio for PSEC has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 0.66, we must say that PSEC is in the distress zone and has some risk of bankruptcy.
PSEC has a worse Altman-Z score (0.66) than 61.64% of its industry peers.
PSEC has a debt to FCF ratio of 3.69. This is a good value and a sign of high solvency as PSEC would need 3.69 years to pay back of all of its debts.
PSEC's Debt to FCF ratio of 3.69 is fine compared to the rest of the industry. PSEC outperforms 69.86% of its industry peers.
PSEC has a Debt/Equity ratio of 0.41. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of PSEC (0.41) is better than 73.52% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.41 | ||
| Debt/FCF | 3.69 | ||
| Altman-Z | 0.66 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
PSEC has a Current Ratio of 0.59. This is a bad value and indicates that PSEC is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.59, PSEC is not doing good in the industry: 71.69% of the companies in the same industry are doing better.
PSEC has a Quick Ratio of 0.59. This is a bad value and indicates that PSEC is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.59, PSEC is not doing good in the industry: 71.69% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.59 | ||
| Quick Ratio | 0.59 |
3. Growth
3.1 Past
PSEC shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -13.59%.
PSEC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 2.68% yearly.
Looking at the last year, PSEC shows a decrease in Revenue. The Revenue has decreased by -9.90% in the last year.
Measured over the past years, PSEC shows a small growth in Revenue. The Revenue has been growing by 4.13% on average per year.
EPS 1Y (TTM)-13.59%
EPS 3Y9.44%
EPS 5Y2.68%
EPS Q2Q%-16.67%
Revenue 1Y (TTM)-9.9%
Revenue growth 3Y10.89%
Revenue growth 5Y4.13%
Sales Q2Q%114.85%
3.2 Future
PSEC is expected to show a very negative growth in Earnings Per Share. In the coming years, the EPS will decrease by -18.23% yearly.
PSEC is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -8.02% yearly.
EPS Next Y-41.11%
EPS Next 2Y-25.35%
EPS Next 3Y-18.23%
EPS Next 5YN/A
Revenue Next Year-14.92%
Revenue Next 2Y-11.21%
Revenue Next 3Y-8.02%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 4.99 indicates a rather cheap valuation of PSEC.
PSEC's Price/Earnings ratio is rather cheap when compared to the industry. PSEC is cheaper than 94.98% of the companies in the same industry.
PSEC's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 29.62.
With a Price/Forward Earnings ratio of 8.21, the valuation of PSEC can be described as very reasonable.
86.76% of the companies in the same industry are more expensive than PSEC, based on the Price/Forward Earnings ratio.
PSEC's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.70.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.99 | ||
| Fwd PE | 8.21 |
4.2 Price Multiples
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PSEC indicates a rather cheap valuation: PSEC is cheaper than 87.21% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 3.52 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
PSEC's earnings are expected to decrease with -18.23% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)1.86
EPS Next 2Y-25.35%
EPS Next 3Y-18.23%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 12.13%, PSEC is a good candidate for dividend investing.
PSEC's Dividend Yield is rather good when compared to the industry average which is at 10.21. PSEC pays more dividend than 81.28% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.27, PSEC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 12.13% |
5.2 History
The dividend of PSEC has a limited annual growth rate of 5.35%.
PSEC has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)5.35%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
PSEC has negative earnings and hence a negative payout ratio. The dividend may be in danger.
DP-404.93%
EPS Next 2Y-25.35%
EPS Next 3Y-18.23%
4.44
-0.01 (-0.22%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners10.79%
Inst Owner Change-80.28%
Ins Owners18.55%
Ins Owner Change11.02%
Market Cap1.97B
Analysts40
Price Target4.08 (-8.11%)
Short Float %4.95%
Short Ratio4.99
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 12.13% |
Yearly Dividend0.87
Dividend Growth(5Y)5.35%
DP-404.93%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)30.58%
Min EPS beat(2)21.11%
Max EPS beat(2)40.06%
EPS beat(4)4
Avg EPS beat(4)27.52%
Min EPS beat(4)12.75%
Max EPS beat(4)40.06%
EPS beat(8)8
Avg EPS beat(8)20.9%
EPS beat(12)12
Avg EPS beat(12)19.72%
EPS beat(16)16
Avg EPS beat(16)18.35%
Revenue beat(2)0
Avg Revenue beat(2)-5.07%
Min Revenue beat(2)-6.01%
Max Revenue beat(2)-4.14%
Revenue beat(4)1
Avg Revenue beat(4)-4.07%
Min Revenue beat(4)-7.33%
Max Revenue beat(4)1.21%
Revenue beat(8)3
Avg Revenue beat(8)-9.72%
Revenue beat(12)6
Avg Revenue beat(12)-5.57%
Revenue beat(16)9
Avg Revenue beat(16)-3.76%
PT rev (1m)0%
PT rev (3m)-11.11%
EPS NQ rev (1m)7.69%
EPS NQ rev (3m)-12.5%
EPS NY rev (1m)3.7%
EPS NY rev (3m)-8.2%
Revenue NQ rev (1m)-5.6%
Revenue NQ rev (3m)-13.4%
Revenue NY rev (1m)-3.28%
Revenue NY rev (3m)-7.07%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.99 | ||
| Fwd PE | 8.21 | ||
| P/S | 2.47 | ||
| P/FCF | 3.52 | ||
| P/OCF | 3.52 | ||
| P/B | 0.39 | ||
| P/tB | 0.39 | ||
| EV/EBITDA | N/A |
EPS(TTM)0.89
EY20.05%
EPS(NY)0.54
Fwd EY12.18%
FCF(TTM)1.26
FCFY28.37%
OCF(TTM)1.26
OCFY28.37%
SpS1.8
BVpS11.45
TBVpS11.45
PEG (NY)N/A
PEG (5Y)1.86
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -1.26% | ||
| ROE | -1.8% | ||
| ROCE | 5.24% | ||
| ROIC | 4.14% | ||
| ROICexc | 4.18% | ||
| ROICexgc | 4.18% | ||
| OM | 46.92% | ||
| PM (TTM) | N/A | ||
| GM | 52.94% | ||
| FCFM | 70.04% |
ROA(3y)2.32%
ROA(5y)4.38%
ROE(3y)3.67%
ROE(5y)6.97%
ROIC(3y)4.06%
ROIC(5y)3.98%
ROICexc(3y)4.1%
ROICexc(5y)4.01%
ROICexgc(3y)4.1%
ROICexgc(5y)4.01%
ROCE(3y)5.14%
ROCE(5y)5.03%
ROICexcg growth 3Y5.53%
ROICexcg growth 5Y-0.41%
ROICexc growth 3Y5.53%
ROICexc growth 5Y-0.41%
OM growth 3Y2.53%
OM growth 5Y1.85%
PM growth 3Y-51.74%
PM growth 5Y-3.58%
GM growth 3Y2.62%
GM growth 5Y1.89%
F-Score3
Asset Turnover0.11
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.41 | ||
| Debt/FCF | 3.69 | ||
| Debt/EBITDA | N/A | ||
| Cap/Depr | N/A | ||
| Cap/Sales | N/A | ||
| Interest Coverage | 2.56 | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.59 | ||
| Quick Ratio | 0.59 | ||
| Altman-Z | 0.66 |
F-Score3
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-13.59%
EPS 3Y9.44%
EPS 5Y2.68%
EPS Q2Q%-16.67%
EPS Next Y-41.11%
EPS Next 2Y-25.35%
EPS Next 3Y-18.23%
EPS Next 5YN/A
Revenue 1Y (TTM)-9.9%
Revenue growth 3Y10.89%
Revenue growth 5Y4.13%
Sales Q2Q%114.85%
Revenue Next Year-14.92%
Revenue Next 2Y-11.21%
Revenue Next 3Y-8.02%
Revenue Next 5YN/A
EBIT growth 1Y-14.59%
EBIT growth 3Y13.69%
EBIT growth 5Y6.06%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y180.7%
FCF growth 3Y108.25%
FCF growth 5Y4.58%
OCF growth 1Y180.7%
OCF growth 3Y108.25%
OCF growth 5Y4.58%