Insider Trading Report: Prospect Capital Corp (PSEC)

Kristin Van Dask, CFO at Prospect Capital Corp (PSEC) recently bought 6,000 shares. The buy increased her stake by 10 percent, and came to a total cost just over $41,200.

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  • She was also the most recent insider to buy, with a 4,250 share pickup back in November, paying nearly $32,000 . A company director has also been active over the past two years. There have been no insider sales over the past two years either.

    Overall, insiders at the business development company (BDC) own about 27.5 percent of shares.

    The company’s business model of providing capital to early-stage companies can come in the form of both equity and fixed-income securities.

    Prospect has held up reasonably well for the environment it’s in. Shares are down about 17 percent in the past year, or about 7 percent overall when accounting for the dividend.

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  • Action to take: Investors looking for current income may like Prospect or other BDC firms, as they’re required to pay out most of their income as distributions. The dividend has been steady, with a current  yield of about 10.8 percent.

    For traders, shares have been trending down overall in this market, but have been prone to sharp rallies. Given the most recent pullback, one could happen soon. The August $7 calls, last going for about $0.20, offer mid-double-digit returns on such a move higher.


    Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.

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