Prospect Capital Corp. (NASDAQ:PSEC) CEO and Director John Barry recently made a significant purchase of company stock. According to a recent SEC filing, Barry acquired 1 million shares of Prospect Capital at a price of $4.63 per share, totaling approximately $4.63 million. This transaction increases Barry's direct ownership to over 74 million shares.
Barry's purchase reflects his continued confidence in the company's prospects, as he maintains a substantial personal stake in the firm. Additionally, Barry's spouse holds an indirect ownership of 328,590 shares.
Prospect Capital, headquartered in New York, operates as a business development company, providing capital to middle-market companies across various industries.
In other recent news, Prospect Capital Corporation has expanded its preferred stock offering to $2.25 billion, indicating strong market demand. This strategic move involves reclassifying 20 million shares from common to preferred stock. The company also reported robust earnings for the fourth quarter of fiscal year 2024, with a net investment income of $102.9 million and a net asset value of $3.71 billion.
On the other hand, Wells Fargo (NYSE:WFC) has revised its expectations for Prospect Capital, downgrading its price target from $5.00 to $4.50 due to a lower Secured Overnight Financing Rate (SOFR) curve and an anticipated increase in shares. Despite these adjustments, Prospect Capital maintains a strong balance sheet, diversified funding sources, and significant liquidity.
In addition, the company has strategically shifted towards first lien debt and clarified that there are no ongoing discussions about forced conversions of preferred stock by the company's board. These recent developments indicate that Prospect Capital is making strategic decisions to maintain shareholder distributions and strengthen its investment portfolio.
InvestingPro Insights
John Barry's recent $4.63 million stock purchase aligns with Prospect Capital's reputation for shareholder returns. According to InvestingPro Tips, PSEC "pays a significant dividend to shareholders" and "has maintained dividend payments for 21 consecutive years." This commitment to dividends is further underscored by the company's current dividend yield of 11.76%, as reported by InvestingPro Data.
However, investors should note that PSEC's financial health presents a mixed picture. The company's revenue for the last twelve months as of Q1 2025 stood at $821.73 million, with a revenue growth decline of 7.23% over the same period. This aligns with another InvestingPro Tip indicating that the "stock has fared poorly over the last month," with a one-month price total return of -12.9%.
Despite these challenges, Barry's substantial investment suggests a long-term belief in the company's potential. Investors considering PSEC may find value in exploring the additional 6 InvestingPro Tips available, which could provide further context to the CEO's recent stock acquisition and the company's overall financial position.
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