Prospect Capital Corp

Prospect Capital Corporation (NASDAQ: PSEC) is an externally managed business development company (BDC) that has elected to be treated as a regulated investment company. Its objective is to generate current income and long-term capital appreciation.

Its core business, middle market lending, accounted for 84% of investments at cost as of September 30, 2026. The company lends to and invests in private U.S. middle-market companies, typically those with annual revenues under $750 million and enterprise values under $1 billion. Borrowers are mostly owned by private equity funded sponsors, independent sponsors or Prospect itself. A typical investment is a senior secured loan of less than $250 million, and first lien debt made up 71.5% of the portfolio at cost.

Prospect also makes equity and equity-linked investments in portfolio companies. Through National Property REIT Corp. (NPRC), it holds a real estate portfolio of 50 developed, occupied multifamily and other cash-flowing properties, representing 15.3% of investments at cost.

As of September 30, 2026, the portfolio held 85 companies across 31 industries, with about $5.9 billion of investments at fair value. The company is rotating away from second lien loans, subordinated structured notes and lower-yielding equity and real estate assets toward first lien loans.

Prospect funds itself through:
- A $2.1 billion revolving credit facility
- Public unsecured notes
- Prospect Capital InterNotes program notes
- Perpetual preferred stock

It pays monthly common distributions. Management and employees own 26% of common shares. Updated Nov 5, 2026