UPDATE: MLV Reiterates Buy On Prospect Capital Following 2Q15 Results


MLV analyst Christopher Nolan was out today with a few insights on Prospect Capital (NASDAQ:PSEC), as the company reported fiscal second-quarter net investment income EPS of $0.26 below MLV’s estimate of $0.28 and consensus expectations of $0.27. Despite the miss, the analyst reiterated a Buy rating and a $10.75 price target, which implies an upside of 27.5% from current levels.

Nolan noted, “At first look, quarterly results demonstrated relatively steady revenue generation relative to the prior quarter with the miss due to higher than expected operating expenses and a slightly higher share count. Asset quality remained steady with no material change in aggregate non-accruals and PSEC energy exposure declined in the quarter. In our view, the outlook for the dividend appears stable given GAAP EPS and taxable income of $0.30/share exceeds the new quarterly dividend payout of $0.25/share and could position PSEC for a supplemental dividend in coming months.”

Prospect Capital is a financial services company that primarily lends to and invests in middle market privately-held companies.