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 231 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 it does not seem to be growing.
1. Profitability
1.1 Basic Checks
PSEC had positive earnings in the past year.
PSEC had a positive operating cash flow in the past year.
In multiple years PSEC reported negative net income over the last 5 years.
In multiple years PSEC reported negative operating cash flow during the last 5 years.
1.2 Ratios
PSEC has a worse Return On Assets (-1.26%) than 78.36% of its industry peers.
PSEC has a Return On Equity of -1.80%. This is in the lower half of the industry: PSEC underperforms 76.62% of its industry peers.
PSEC has a Return On Invested Capital (4.14%) which is in line with its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for PSEC is below the industry average of 7.24%.
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.
Looking at the Operating Margin, with a value of 46.92%, PSEC belongs to the top of the industry, outperforming 83.12% of the companies in the same industry.
PSEC's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 52.94%, PSEC is in the better half of the industry, outperforming 61.04% of the companies in the same industry.
In the last couple of years the Gross Margin of PSEC has grown nicely.
| 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
Compared to 1 year ago, PSEC has more shares outstanding
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
PSEC has an Altman-Z score of 0.52. This is a bad value and indicates that PSEC is not financially healthy and even has some risk of bankruptcy.
PSEC has a worse Altman-Z score (0.52) than 63.64% of its industry peers.
The Debt to FCF ratio of PSEC is 3.69, which is a good value as it means it would take PSEC, 3.69 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.69, PSEC is in the better half of the industry, outperforming 71.43% of the companies in the same industry.
PSEC has a Debt/Equity ratio of 0.41. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.41, PSEC is in the better half of the industry, outperforming 72.29% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.41 | ||
| Debt/FCF | 3.69 | ||
| Altman-Z | 0.52 |
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: 71.86% 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.
PSEC's Quick ratio of 0.59 is on the low side compared to the rest of the industry. PSEC is outperformed by 71.86% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.59 | ||
| Quick Ratio | 0.59 |
3. Growth
3.1 Past
The earnings per share for PSEC have decreased strongly by -21.00% in the last year.
The Earnings Per Share has been growing slightly by 2.68% on average over the past years.
Looking at the last year, PSEC shows a small growth in Revenue. The Revenue has grown by 1.11% in the last year.
The Revenue has been growing slightly by 4.13% on average over the past years.
EPS 1Y (TTM)-21%
EPS 3Y9.44%
EPS 5Y2.68%
EPS Q2Q%-43.48%
Revenue 1Y (TTM)1.11%
Revenue growth 3Y10.89%
Revenue growth 5Y4.13%
Sales Q2Q%-15.58%
3.2 Future
The Earnings Per Share is expected to decrease by -23.25% on average over the next years. This is quite bad
The Revenue is expected to decrease by -10.61% on average over the next years. This is quite bad
EPS Next Y-41.11%
EPS Next 2Y-29.7%
EPS Next 3Y-23.25%
EPS Next 5YN/A
Revenue Next Year-15.84%
Revenue Next 2Y-13.61%
Revenue Next 3Y-10.61%
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 4.10, the valuation of PSEC can be described as very cheap.
96.10% of the companies in the same industry are more expensive than PSEC, based on the Price/Earnings ratio.
PSEC's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 26.19.
PSEC is valuated cheaply with a Price/Forward Earnings ratio of 6.76.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PSEC indicates a rather cheap valuation: PSEC is cheaper than 91.77% of the companies listed in the same industry.
PSEC's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.13.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.1 | ||
| Fwd PE | 6.76 |
4.2 Price Multiples
Based on the Price/Free Cash Flow ratio, PSEC is valued cheaper than 89.18% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 2.62 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
A cheap valuation may be justified as PSEC's earnings are expected to decrease with -23.25% in the coming years.
PEG (NY)N/A
PEG (5Y)1.53
EPS Next 2Y-29.7%
EPS Next 3Y-23.25%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 14.63%, PSEC is a good candidate for dividend investing.
In the last 3 months the price of PSEC has falen by -26.36%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
Compared to an average industry Dividend Yield of 8.17, PSEC pays a better dividend. On top of this PSEC pays more dividend than 90.91% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.40, PSEC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 14.63% |
5.2 History
The dividend of PSEC has a limited annual growth rate of 5.35%.
PSEC has paid a dividend for at least 10 years, which is 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-29.7%
EPS Next 3Y-23.25%
3.24
-0.04 (-1.22%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners10.79%
Inst Owner Change29.01%
Ins Owners18.55%
Ins Owner Change4.11%
Market Cap1.46B
Analysts40
Price Target3.57 (10.19%)
Short Float %7.3%
Short Ratio7.35
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 14.63% |
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)-12.5%
PT rev (3m)-12.5%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)-1.08%
Revenue NY rev (3m)-1.08%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.1 | ||
| Fwd PE | 6.76 | ||
| P/S | 1.84 | ||
| P/FCF | 2.62 | ||
| P/OCF | 2.62 | ||
| P/B | 0.29 | ||
| P/tB | 0.29 | ||
| EV/EBITDA | N/A |
EPS(TTM)0.79
EY24.38%
EPS(NY)0.48
Fwd EY14.8%
FCF(TTM)1.24
FCFY38.12%
OCF(TTM)1.24
OCFY38.12%
SpS1.76
BVpS11.23
TBVpS11.23
PEG (NY)N/A
PEG (5Y)1.53
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 | 0.52 |
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)-21%
EPS 3Y9.44%
EPS 5Y2.68%
EPS Q2Q%-43.48%
EPS Next Y-41.11%
EPS Next 2Y-29.7%
EPS Next 3Y-23.25%
EPS Next 5YN/A
Revenue 1Y (TTM)1.11%
Revenue growth 3Y10.89%
Revenue growth 5Y4.13%
Sales Q2Q%-15.58%
Revenue Next Year-15.84%
Revenue Next 2Y-13.61%
Revenue Next 3Y-10.61%
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%