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Upturn AI SWOT - About
PSEC 
Prospect Capital Corporation (PSEC)
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Upturn Advisory Summary
09/12/2025: PSEC (1-star) is currently NOT-A-BUY. Pass it for now.
Upturn Star Rating
Not Recommended Performance
These Stocks/ETFs, based on Upturn Advisory, consistently fall short of market performance, signaling caution before investing.
Number of Analysts
1 Analysts rated it
Very few follow this stock; limited insights, higher-risk early investing.
1 Year Target Price $2.5
1 Year Target Price $2.5
| 0 | Strong Buy |
| 0 | Buy |
| 0 | Hold |
| 0 | Sell |
| 1 | Strong Sell |
Analysis of Past Performance
Type Stock | Historic Profit -38.6% | Avg. Invested days 27 | Today’s Advisory PASS |
Upturn Star Rating | Upturn Advisory Performance  1.0 | Stock Returns Performance  1.0 |
| Profits based on simulation | Last Close 09/12/2025 |
Key Highlights
Company Size Small-Cap Stock | Market Capitalization 1.29B USD | Price to earnings Ratio - | 1Y Target Price 2.5 |
Price to earnings Ratio - | 1Y Target Price 2.5 | ||
Volume (30-day avg) 1 | Beta 0.85 | 52 Weeks Range 2.69 - 4.83 | Updated Date 09/14/2025 |
52 Weeks Range 2.69 - 4.83 | Updated Date 09/14/2025 | ||
Dividends yield (FY) 21.43% | Basic EPS (TTM) -1.35 |
Earnings Date
Report Date 2025-08-26 | When - | Estimate 0.13 | Actual 0.17 |
Profitability
Profit Margin -65.32% | Operating Margin (TTM) 67.94% |
Management Effectiveness
Return on Assets (TTM) 4.15% | Return on Equity (TTM) -9.48% |
Valuation
Trailing PE - | Forward PE - | Enterprise Value 4939392000 | Price to Sales(TTM) 1.79 |
Enterprise Value 4939392000 | Price to Sales(TTM) 1.79 | ||
Enterprise Value to Revenue 14.9 | Enterprise Value to EBITDA 9.42 | Shares Outstanding 462343008 | Shares Floating - |
Shares Outstanding 462343008 | Shares Floating - | ||
Percent Insiders 27.68 | Percent Institutions 14.96 |
Upturn AI SWOT
Prospect Capital Corporation
Company Overview
History and Background
Prospect Capital Corporation was founded in 2004. It is a publicly traded business development company (BDC) that focuses on lending to and investing in middle-market companies.
Core Business Areas
- Direct Lending: Provides secured loans, including first lien and second lien debt, to established middle-market companies.
- Buyout and Acquisition Financing: Finances leveraged buyouts, acquisitions, and recapitalizations of companies.
- Real Estate: Invests in real estate-related assets, including senior and mezzanine debt.
- Sponsored Lending: Provides financing to companies backed by private equity sponsors.
Leadership and Structure
Prospect Capital Corporation is led by a team of investment professionals. John F. Barry III is the Chairman and CEO. The company operates as a BDC regulated under the Investment Company Act of 1940.
Top Products and Market Share
Key Offerings
- First Lien Senior Secured Debt: Loans secured by a first priority lien on the borrower's assets. This offering generates a significant portion of Prospect Capital's revenue. Market share data specifically for first lien lending in the middle market is not readily available without proprietary data sources. Competitors include Ares Capital Corporation (ARCC), Owl Rock Capital Corporation (ORCC), and Golub Capital BDC (GBDC).
- Second Lien Senior Secured Debt: Loans secured by a second priority lien on the borrower's assets. This carries higher risk and therefore higher interest rates. Market share is not precisely quantifiable without proprietary data. Competitors are similar to those in first lien lending: Ares Capital Corporation (ARCC), Owl Rock Capital Corporation (ORCC), and Golub Capital BDC (GBDC).
- Mezzanine Debt: Subordinated debt that is often unsecured or has a lower priority claim on assets. It generates a higher yield, reflecting its increased risk. Market share is difficult to define precisely. Competitors are similar to those above.
Market Dynamics
Industry Overview
The BDC industry is highly competitive. BDCs provide financing solutions to middle-market companies, often filling a gap left by traditional banks. The industry is influenced by economic conditions, interest rates, and regulatory changes.
Positioning
Prospect Capital Corporation positions itself as a provider of flexible capital solutions to middle-market companies. Its competitive advantages are scale, experience, and origination capabilities. Prospect's high dividend yield (compared to other BDCs) is often used to attract investors.
Total Addressable Market (TAM)
The TAM for middle-market lending is substantial, estimated to be in the hundreds of billions of dollars annually. Prospect Capital Corporation targets a segment of this market with its focus on yield-generating investments. Their positioning is focused on shareholder returns through income.
Upturn SWOT Analysis
Strengths
- Experienced management team
- Diversified investment portfolio
- Established origination platform
- High dividend yield
Weaknesses
- High operating expenses
- External management structure
- Reliance on external financing
- Complex capital structure
- Potential for conflicts of interest due to external management
Opportunities
- Increased demand for private credit
- Expansion into new industries and geographies
- Strategic acquisitions
- Rising interest rates can increase net investment income
Threats
- Economic downturn
- Increased competition
- Rising interest rates (increase borrowing costs)
- Regulatory changes
- Credit losses
Competitors and Market Share
Key Competitors
- ARCC
- ORCC
- GBDC
- TCPC
Competitive Landscape
Prospect Capital Corporation faces strong competition from other BDCs. Its high dividend yield is a key differentiator, but its external management structure and high operating expenses are disadvantages.
Major Acquisitions
Credit Management Corporation
- Year: 2010
- Acquisition Price (USD millions): 77.1
- Strategic Rationale: To enhance internal origination capabilities and generate higher-yielding investment opportunities in a broader range of transaction sizes.
Growth Trajectory and Initiatives
Historical Growth: Historical growth has been primarily driven by acquisitions and new investment origination. Prospect Capital Corporation has faced challenges in maintaining consistent growth.
Future Projections: Future growth is dependent on the company's ability to deploy capital effectively, manage expenses, and generate sufficient investment income. Analyst estimates vary.
Recent Initiatives: Recent initiatives include focusing on secured lending and managing the investment portfolio to optimize returns.
Summary
Prospect Capital Corporation is a BDC that focuses on lending to middle-market companies, known for its high dividend yield. However, concerns exist about the sustainability of the dividends and high operating costs. The company benefits from an experienced team and diversified portfolio, but faces risks from economic downturns and increasing competition. Effective management of its portfolio and operating expenses are crucial for future success.
Peer Comparison
Sources and Disclaimers
Data Sources:
- SEC Filings (10-K, 10-Q)
- Company Website
- Analyst Reports
- Industry Publications
Disclaimers:
This analysis is based on publicly available information and is for informational purposes only. It is not financial advice. Market share data is estimated and may not be precise. Please consult with a financial professional before making any investment decisions.
AI Summarization is directionally correct and might not be accurate.
Summarized information shown could be a few years old and not current.
Fundamental Rating based on AI could be based on old data.
AI-generated summaries may have inaccuracies (hallucinations). Please verify the information before taking action.
About Prospect Capital Corporation
Exchange NASDAQ | Headquaters New York, NY, United States | ||
IPO Launch date 2004-07-27 | Chairman of the Board & CEO Mr. John Francis Barry III, J.D. | ||
Sector Financial Services | Industry Asset Management | Full time employees - | |
Full time employees - | |||
Prospect Capital Corporation is a business development company. It specializes in middle market, mature, mezzanine finance, later stage, emerging growth, leveraged buyouts, refinancing, acquisitions, recapitalizations, turnaround, growth capital, development, capital expenditures and subordinated debt tranches of collateralized loan obligations, cash flow term loans, market place lending and bridge transactions. It also makes real estate investments particularly in multi-family residential real estate asset class. The fund makes secured debt, senior debt, senior and secured term loans, unitranche debt, first-lien and second lien, private debt, private equity, mezzanine debt, and equity investments in private and microcap public businesses. It focuses on both primary origination and secondary loans/portfolios and invests in situations like debt financings for private equity sponsors, acquisitions, dividend recapitalizations, growth financings, bridge loans, cash flow term loans, real estate financings/investments. It also focuses on investing in small-sized and medium-sized private companies rather than large public companies. The fund typically invests across all industry sectors, with a particular expertise in the energy and industrial sectors. It invests in aerospace and defense, chemicals, conglomerate services, consumer services, ecological, electronics, financial services, machinery, manufacturing, media, pharmaceuticals, retail, software, specialty minerals, textiles and leather, transportation, oil and gas production, coal production, materials, industrials, consumer discretionary, information technology, utilities, pipeline, storage, power generation and distribution, renewable and clean energy, oilfield services, healthcare, food and beverage, education, business services, and other select sectors. It prefers to invest in the United States and Canada. The fund seeks to invest between $10 million to $500 million per transaction in companies with EBITDA between $5 million and $150 million, sales value betw
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