Prospect Capital Corp (PSEC) stock analysis

PSECNasdaqFiscal year ends June 30Also trades as PSEC.PA

Financials through Q1 FY2027, quarter ended Sep 30, 2026Last filing: 10-Q on Nov 4, 2026Score 10/3083% below fair value

$1.50+0.00 (0.00%)

Close on Nov 11, 2026Market cap $787.25MP/E –Yield –

StockData Score

Prices as of Nov 11, 2026How the score works

Mixed10 of 30 checks passed

Prospect Capital passes 10 of the 30 checks behind our score; 15 could not be run for lack of data and count as not passed. Each dot in the shape is one check — hover it for the numbers.

Valuation: 3/6
Growth: 0/6
Past performance: 0/6
Financial health: 4/6
Dividend: 3/6

What stands out

Margin of safety over 20%
The price is 82.9% below fair value, more than the 20% cushion we look for.
Trading below fair value
The share price of $1.50 is below our fair value estimate of $8.77.
No debt
Prospect Capital has no borrowings on its latest balance sheet.
Interest well covered
No meaningful interest expense to cover.

What to watch

Return on equity under 15%
Return on equity was 1.8% over the last twelve months and averaged 2.0% over five years; we look for 15% on both.
Earnings shrank over 5 years
Net income shrank 30.7% a year on average over the last five fiscal years.
Elevated bankruptcy risk
The Altman Z-score is -0.05; above 3 is the safe zone and below 1.8 the distress zone.
Not covered by earnings
Dividends take 577% of net income, leaving little room.

Valuation3/6

P/E against its history
Not enough price and earnings history to compare.
P/E against the industry
Needs positive earnings and enough profitable companies in the industry.
EV/EBITDA against its history
Needs positive EBITDA and price history.
P/B below the industry
Prospect Capital's price-to-book of 0.27 is below the US market median of 1.92.
Trading below fair value
The share price of $1.50 is below our fair value estimate of $8.77.
Margin of safety over 20%
The price is 82.9% below fair value, more than the 20% cushion we look for.

Growth0/6

Revenue growth over 3 years
Needs three years of positive revenue.
EPS growth over 3 years
Needs positive EPS three years ago and today.
Earnings acceleration
Needs positive net income now, a year ago and five years ago.
Growth against the industry
Needs revenue for this year and last.
Company guidance
No outlook found in earnings releases from the last twelve months.
Gross margin trend
This company does not report gross profit.

Past performance0/6

Return on equity under 15%
Return on equity was 1.8% over the last twelve months and averaged 2.0% over five years; we look for 15% on both.
Return on invested capital
Needs operating income and invested capital.
Return on equity below the industry
Prospect Capital's return on equity of 1.8% is below the US market median of 3.5%.
Earnings shrank over 5 years
Net income shrank 30.7% a year on average over the last five fiscal years.
Net margin against its history
Needs five years of revenue and net income.
Net margin against the industry
Needs revenue and net income.

Financial health4/6

No debt
Prospect Capital has no borrowings on its latest balance sheet.
Debt not rising
With no debt today, leverage cannot have risen.
Debt covered by cash flow
There is no debt to cover.
Interest well covered
No meaningful interest expense to cover.
Short-term liquidity
The balance sheet is not split into current and non-current items.
Elevated bankruptcy risk
The Altman Z-score is -0.05; above 3 is the safe zone and below 1.8 the distress zone.

Dividend3/6

Pays a dividend
Prospect Capital paid dividends worth 32.0% of the share price over the last twelve months.
Yield above Treasuries
The 32.0% yield is above the 4.4% on a 1-year Treasury.
Yield in the top quarter
The top quarter of US dividend payers yield 3.8% or more; Prospect Capital yields 32.0%.
Dividend stability
Fewer than five years of dividend history.
Not covered by earnings
Dividends take 577% of net income, leaving little room.
Cash-flow cover
Needs dividends paid and free cash flow.

Fair value

How we estimate it

Our estimate per share

$8.77

The share price is 83% below this estimate.

20%+ below

Near fair value

20%+ above

$1.50Price$8.77Fair value

Method	Multiple used	Own 5Y median	Industry median	Value per share	Weight
P/B	1.3×	0.6×	1.9×	$7.39	40%
Earnings power	8.6% cost of equity	–	–	$9.69	60%
Fair value				$8.77	100%

Valuation over time

Using the earnings and balance sheet published at each date, not today's.

P/E at month end
US market median 19.5

An estimate from reported numbers and market multiples, not a price target or investment advice. It can be far off for companies whose profits are about to change sharply.

Market risk

From the past year of daily prices.

Liquidity

Medium risk

Average value traded per day: $12.26M
Value traded per 1% price move: $5.51M

Downside

High risk

Typical loss in a bad month: 29.5%
Volatility (annualized): 38%
Sharpe ratio, 1 year: -1.38
Beta to the S&P 500 (5Y): 0.75

Typical bad-month loss, week by week

Margins need revenue and profit figures

This company does not report the lines needed to calculate margins.

Per year	1 year	3 years	5 years	10 years	Five-year pace
Net income	–	–	-30.7%	–
EPS, diluted	–	–	-52.6%	–

Measure	FY2018	FY2021	FY2026
Return on equity	–	27.5%	5.2%
Return on assets	–	–	2.3%
Diluted shares	361M	386M	480M

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