NEW YORK (TheStreet) -- Prospect Capital (PSEC) was falling -2.5% to $10.47 Wednesday after the company missed analysts' estimates in the fiscal third quarter and news that the SEC ordered the company to restate financials.
For the third quarter Prospect Capital reported NII of 31 cents a share, missing the Capital IQ Consensus Estimate of 32 cents a share by 1 cent. Total Investment Income grew 58.3% to $190.32 million for the quarter. Analysts expected Total Investment Income of $192.1 million for the quarter.
In a 10-Q filing with the SEC Prospect disclosed that the agency ordered the company to "restate financials to consolidate on its balance sheet those companies in which Prospect has more than a 50% interest," according to Seeking Alpha. The company plans to appeal the SEC ruling.
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TheStreet Ratings team rates PROSPECT CAPITAL CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate PROSPECT CAPITAL CORP (PSEC) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income, expanding profit margins, good cash flow from operations and growth in earnings per share. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."