In a research report issued today, MLV analyst Christopher Nolan maintained a Buy rating on Prospect Capital (NASDAQ:PSEC) but slightly reduced his price target to $11 (from $11.50), which represents a potential upside of 16% from where the stock is currently trading.
Nolan explained, “Following the fiscal 1Q15 earnings conference call, we continue to believe the current dividend payout is secure until fiscal 4Q15. However, beyond then depends on PSEC’s ability to improve investment yields. The announced strategy to spin off an estimated $1.5b in assets via 3 publicly traded entities has merit as a way to help address PSEC’s share price discount to NAV. However, PSEC management has not yet finalized the precise structure and implementation mechanics of these spin-offs, so it is too soon to estimate the impact to future earnings and dividends.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Christopher Nolan has a total average return of 6.3% and a 60.0% success rate. Nolan has a -0.3% average return when recommending PSEC, and is ranked #1839 out of 3365 analysts.