Prospect Capital (NASDAQ:PSEC) Shares Up 8.6% on Better-Than-Expected Earnings

Shares of Prospect Capital Corporation (NASDAQ:PSEC) were up 8.6% on Tuesday following a better than expected earnings announcement. The stock traded as high as $2.84 and last traded at $2.8350. Approximately 2,991,955 shares changed hands during mid-day trading, a decline of 27% from the average daily volume of 4,121,565 shares. The stock had previously closed at $2.61.

The financial services provider reported $0.19 EPS for the quarter, topping the consensus estimate of $0.10 by $0.09. Prospect Capital had a positive return on equity of 12.29% and a negative net margin of 42.50%.The business had revenue of $176.00 million during the quarter, compared to analysts’ expectations of $156.34 million.

Prospect Capital Announces Dividend

The firm also recently announced a monthly dividend, which will be paid on Tuesday, May 19th. Stockholders of record on Tuesday, April 28th will be issued a $0.045 dividend. The ex-dividend date is Tuesday, April 28th. This represents a c) dividend on an annualized basis and a dividend yield of 19.0%. Prospect Capital’s dividend payout ratio is currently -62.79%.

Prospect Capital News Summary

Here are the key news stories impacting Prospect Capital this week:

• Positive Sentiment: Q2 results beat expectations — Prospect reported $0.19 EPS vs. consensus $0.10 and $176M revenue vs. ~$156M, with management citing improved total investment income; that earnings/revenue beat is the main positive catalyst. Prospect Capital Announces Financial Results for December 2025
• Positive Sentiment: The company declared monthly dividends of $0.045 per share (annualized yield ~19.6%), with upcoming record/ex-dividend dates in Feb, Mar and Apr — a high yield that supports income-seeking demand for the shares. (Multiple declarations reported Feb 9, 2026.)
• Neutral Sentiment: Prospect also announced 2026 distributions and published the quarter’s investor package / conference call materials — useful for assessing portfolio composition and realized vs. unrealized gains. Prospect Capital Reports Quarterly Results, Declares 2026 Distributions
• Neutral Sentiment: An affiliated vehicle, Prospect Enhanced Yield Fund, reported strong short-term performance (10.6% net annualized 3-month total return; 9.0% cash dividend yield on NAV) — positive for the firm’s product lineup but peripheral to PSEC’s core BDC results. Prospect Enhanced Yield Fund Announces 10.6% Net Annualized 3-Month Total Return
• Negative Sentiment: Despite the beat, the company still shows a negative net margin (reported ~-42.5%) and relies on distributions that yield nearly 20% — investors may worry about payout sustainability, portfolio credit performance, and the potential pressure on NAV if investment income moderates. Prospect Capital Earnings Report (MarketBeat)

Analyst Ratings Changes

PSEC has been the topic of a number of research analyst reports. Wall Street Zen raised shares of Prospect Capital from a “hold” rating to a “buy” rating in a research report on Saturday, December 6th. Weiss Ratings reaffirmed a “sell (d)” rating on shares of Prospect Capital in a research note on Thursday, January 22nd. Two research analysts have rated the stock with a Sell rating, According to data from MarketBeat.com, Prospect Capital presently has a consensus rating of “Sell” and a consensus price target of $2.50.

Institutional Trading of Prospect Capital

A number of institutional investors and hedge funds have recently made changes to their positions in PSEC. Catalyst Financial Partners LLC acquired a new stake in shares of Prospect Capital in the fourth quarter worth $26,000. Bfsg LLC bought a new stake in Prospect Capital in the 4th quarter valued at $27,000. Navalign LLC acquired a new stake in Prospect Capital in the 3rd quarter worth $28,000. Ground Swell Capital LLC bought a new position in shares of Prospect Capital during the 4th quarter worth about $28,000. Finally, Evergreen Capital Management LLC acquired a new position in shares of Prospect Capital during the fourth quarter valued at about $30,000. Institutional investors and hedge funds own 9.06% of the company’s stock.

Prospect Capital Price Performance

The company has a quick ratio of 1.22, a current ratio of 1.22 and a debt-to-equity ratio of 0.64. The stock’s 50-day moving average price is $2.68 and its 200 day moving average price is $2.75. The firm has a market cap of $1.34 billion, a price-to-earnings ratio of -3.31 and a beta of 0.89.

Prospect Capital Company Profile

Prospect Capital Corporation is a publicly traded business development company listed on the Nasdaq stock exchange that specializes in providing private debt and equity financing solutions to middle-market companies across the United States. Structured as a closed-end, non-diversified management investment company under the Investment Company Act of 1940, Prospect Capital offers investors access to a diversified portfolio of senior secured loans, subordinated debt and selective equity interests in privately held businesses.

Since its founding in 2004, Prospect Capital has focused on tailoring financing structures to meet the growth, acquisition and recapitalization needs of its portfolio companies.