Prospect Capital Preferred Stock Sees Increased Yield

In a recent report, shares of Prospect Capital Corporation's preferred stock have climbed above the 7% yield mark. Despite a slight decline in trading prices, investors may find the attractive yield noteworthy for income-focused portfolios.

Date: 11-09-2024

AI Rating: 6

The report highlights that Prospect Capital Corporation's 5.35% Series A Cumulative Preferred Stock (PSEC.PRA) is yielding above 7% based on its quarterly dividend. This yield is noteworthy when compared to the average yield of 6.42% within the Financial preferred stock category. Such a yield increase can attract income-seeking investors, potentially leading to a rise in demand for these shares.

Furthermore, the report mentions that PSEC.PRA is currently trading at a 23.24% discount to its liquidation preference amount. In comparison, the average discount in the Financial category is only 6.32%. This substantial discount could signal to investors that the stock is undervalued, prompting interest among bargain hunters.

While the trading activity indicates a slight decline, with PSEC.PRA down about 0.7% for the day and the common shares (PSEC) down 0.8%, the underlying aspects of the yield and relative discount may balance out the short-term negative performance. Investors focused on dividends might view this as a strategic entry point.

Stocks: PSEC