This is actually more typical than you would think; I announce a new position, it gets walloped in the public square. We all have a good laugh…except for a few of you pricks, you have a little more than a good laugh.
But you’re never around when I’m up huge, I noticed.
I had thought there was a chance that PSEC would see earnings per share surprise – they have vastly increased investment activity. Admittedly all but ~6% of that was financed from at-the-market share offerings, but I had hoped there would be a pass through. Instead, it dropped and so 4% down day.
Thankfully, it was, as I said, only half a position, so the effect is muted (by definition, I consider a full position in a stock no less than 10% of my assets).
On the one hand, it is cheap. And the payout seems, at the moment, well secured. Growth prospects are debatable. It has grown immensely, but then that hasn’t really helped shareholders out lately. It’s a complex quagmire of financial legalese (which is the very worst kind there is). But is there even a major tradeoff at these prices?
I’ll see what happens tomorrow. There are parts of PSEC that I am very much not in love with (and actively hate). So it may prove to be a short lived detour on the road of life…
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Apparently, they held back on loan originations in q2 because of the SEC issue. From what I’ve read that issue is now resolved
I’m guessing that created pent up demand, so they should do well this quarter.
Your guess is as good as mine. I’m floating between selling out (they have not shown this growth is flowing to shareholders) versus sitting tight and seeing what happens (it’s so damn cheap, why not take a ride on black?)
Hey hat tip to Griff for calling the CCJ strike
the CEO holds over 4 million shares. He wants income to flow to shareholders more than anyone does. To register a company as a BDC, you must distribute 90% of the income to shareholders. It is down this week on the fears that the dividend will be cut. They have not earned what they have paid out in the last 3-4 quarters. The insiders will take a huge haircut if they lower the dividend, so you can bet they are working overtime to prevent it.
Also the changes in accounted demanded by the SEC are supposed to show greater income on the books for the company and less fees in managements personal bank accounts.