Seeking Alpha

Along with nearly every other high-yield stock, Prospect Capital (PSEC) has seen its share price fall sharply over the past few weeks. Since about May 1, Prospect Capital stock has fallen and it now trades at a small discount to its NAV. Prospect Capital offers about a $0.11 per share monthly dividend and, at current prices, yields about 12.70%.

Overview

Prospect Capital is a business development company, or BDC, which typically invests in private company equity or debt and mezzanine loans. Unlike mREITs, Prospect Capital typically achieves a high ROE on its assets and therefore deploys very little leverage. As of March 31, Prospect Capital had a pipeline of about $500M in potential investments with...

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