Out Fox The $treet

While Prospect Capital Corporation ( PSEC ) continues to report record originations, the company is failing to pull those numbers to the net investment income (NII) line. Not only did the last quarter show essentially flat NII, but also it occurred on a substantially higher share base. Prospect Capital is a leading provider of flexible private debt and equity capital to sponsor-owned and non-sponsor-owned middle market companies in the United States and Canada. It trades as a closed-end investment company that has elected to be treated as a business development company ( BDC ) under the Investment Company Act of 1940. Read the full article at Seeking Alpha. Disclosure: No positions mentioned. Please review the disclaimer page for more details. 

After the trading week closed on Thursday, March 28, Prospect Capital Corporation ( PSEC ) made a surprising announcement that the company had originated a record $800 million during the March quarter. The surprise comes after the company claimed in early February that the originations for Q1 were a mediocre $141 million almost halfway into the quarter. The market didn't actually expect much following the year-end push to exit businesses to beat the tax deadline. Prospect Capital is a leading provider of flexible private debt and equity capital to sponsor-owned and non-sponsor-owned middle market companies in the United States and Canada. It trades as a closed-end investment company that has elected to be treated as a business development company (BDC) under the Investment Company Act of 1940. The origination pace, while bullish, does bring into play a previous concern about another equity raise, as a surge in deals were the only reason equity would be needed. C...

With the market craving yields, it is amazing that several business development stocks can still yield around 10%. Both Solar Capital ( SLRC ) and TICC Capital ( TICC ) have had yields around 10% for a considerable amount of time. While Prospect Capital ( PSEC ) remains a favorite (see Prospect Capital: Prospecting For Even Higher Dividends ) with a yield of nearly 12%, the question is whether either of these less followed BDCs provide a better investment? Solar Capital The company operates as a closed-end investment company that invests primarily in leveraged, middle market companies in the form of senior secured loans, mezzanine loans, and equity securities. The stock has a market cap of $1.1B and currently yields 9.7%. Read the full article at Seeking Alpha. Disclosure: No positions mentioned. Please review the disclaimer page for more details. 

Strangely, the stock market continues to allow a company to repurchase stock at a substantial discount to net asset value (NAV). American Capital, Ltd ( ACAS ) has completed a 52M share repurchase program for nearly $500M over the last 6 quarters at an average discount to a continuously soaring NAV of nearly 40%. The stock though continues to trade at a substantial discount even after having the ability to spend that much cash. American Capital is a private equity firm and global asset manager. American Capital, both directly and through its asset management business, originates, underwrites and manages investments in middle market private equity, leveraged finance, real estate and structured products. American Capital manages $18.6 billion of assets, including assets on its balance sheet and fee earning assets under management by affiliated managers, with $117 billion of total assets under management (including levered assets). The question remains why investors allo...

When last writing about Prospect Capital Corporation (PSEC) , the stock traded right above Net Asset Value (NAV) with fears of another capital raise. After reporting Q4 results last week, management calmed the fears of another capital raise due to strong liquidity. The dilemma remains on whether to invest now and collect the high monthly dividends or wait for a capital raise that might never happen. Prospect Capital is a leading provider of flexible private debt and equity capital to sponsor-owned and non-sponsor-owned middle market companies in the United States and Canada. It trades as a closed-end investment company that has elected to be treated as a business development company (BDC) under the Investment Company Act of 1940. The stock continues to yield nearly 12% after possibly the smallest monthly dividend increases in the market. The company continues to raise the monthly distribution by a fraction of a cent. Read the full article at Seeking Alpha. Disclosure: Long AC...

The business development companies ((BDCs)) continue to garner more investor attention as the access to a different investment class and high yields become ever more attractive. After highlighting Prospect Capital Corporation (PSEC) a few weeks back, Fifth Street Finance Corp. (FSC) now garners our attention with a yield above 10%. Fifth Street Finance is a specialty finance company that lends to and invests in small and mid-sized companies in connection with investments by private equity sponsors. The company provides full debt structure financing solutions including: first lien, second lien, mezzanine, and one-stop. It trades as a closed-end investment company that has elected to be treated as a business development company (BDC) under the Investment Company Act of 1940. Though the company that went public in 2008 has historically not grown Net Asset Value (NAV), Fifth Street recently reported record transaction volumes for the December quarter. Read the full article at Seeking ...

In a market that can't get enough yield, it's interesting that a dividend grower can yield nearly 12%. In fact, Prospect Capital Corporation (PSEC) has consistently increased the monthly dividend ever since the bottom of the financial crisis impact in 2010. Prospect Capital is a leading provider of flexible private debt and equity capital to sponsor-owned and non-sponsor-owned middle market companies in the United States and Canada. It trades as a closed-end investment company that has elected to be treated as a business development company ((BDC)) under the Investment Company Act of 1940. Read the full article at Seeking Alpha. Disclosure: Long ACAS. Please review the disclaimer page for more details.