Palmer Square Capital BDC (NYSE:PSBD) Releases Earnings Results, Beats Estimates By $0.06 EPS

by · The Markets Daily

Palmer Square Capital BDC (NYSE:PSBD – Get Free Report) issued its quarterly earnings data on Wednesday. The company reported $0.46 EPS for the quarter, beating the consensus estimate of $0.40 by $0.06, FiscalAI reports. The company had revenue of $26.57 million during the quarter, compared to analysts’ expectations of $26.69 million. Palmer Square Capital BDC had a negative net margin of 18.27% and a positive return on equity of 11.16%.

Here are the key takeaways from Palmer Square Capital BDC’s conference call:

  • Third-quarter net investment income fell to $0.38 per share from $0.43 a year earlier. The board set the fourth-quarter base dividend at $0.36 per share, with any supplemental distribution still to be determined.
  • NAV per share rose $0.13 sequentially to $13.34, while debt-to-equity declined to 1.63x from 1.71x. The company also reported $2.4 million in net realized and unrealized gains, versus losses a year ago.
  • Management described portfolio credit quality as resilient: 97% of investments were senior secured, non-accruals were 0.96% of cost, and PIK income was 2.18% of total investment income. First-lien borrowers had 2.38x interest coverage on average.
  • PSBD repurchased $5.2 million of shares during the quarter and had $24.8 million of capacity remaining under its buyback plan, which management said remains a near-term priority. The company also refinanced and extended its CLO, reducing its spread to SOFR plus 139 basis points from 172.
  • Management expects rate volatility and uncertainty to keep deal activity muted in the near term, while noting that tighter spreads make private credit and secondary-market loans more attractive than new syndicated issuance. It said portfolio deployment will remain selective and buybacks or debt paydown may take priority when opportunities are less compelling.

Palmer Square Capital BDC Stock Performance

PSBD traded down $0.01 on Friday, reaching $9.88. The company had a trading volume of 228,929 shares, compared to its average volume of 114,484. Palmer Square Capital BDC has a 52-week low of $9.34 and a 52-week high of $12.61. The company has a market cap of $302.98 million, a price-to-earnings ratio of -15.69 and a beta of 0.85. The business has a 50 day simple moving average of $9.99 and a 200 day simple moving average of $10.49.

Palmer Square Capital BDC Announces Dividend

The business also recently announced a quarterly dividend, which will be paid on Wednesday, January 13th. Investors of record on Monday, December 28th will be paid a $0.36 dividend. This represents a $1.44 dividend on an annualized basis and a yield of 14.6%. The ex-dividend date of this dividend is Monday, December 28th. Palmer Square Capital BDC’s dividend payout ratio (DPR) is currently -145.45%.

Analysts Set New Price Targets

PSBD has been the subject of several analyst reports. UBS Group cut their price target on shares of Palmer Square Capital BDC from $11.00 to $10.00 and set a “neutral” rating for the company in a report on Tuesday, September 1st. Zacks Research raised shares of Palmer Square Capital BDC from a “strong sell” rating to a “hold” rating in a report on Monday, August 10th. Finally, Wall Street Zen upgraded Palmer Square Capital BDC from a “sell” rating to a “hold” rating in a research report on Saturday, August 8th. Five research analysts have rated the stock with a Hold rating. Based on data from MarketBeat.com, the company presently has an average rating of “Hold” and a consensus target price of $10.50.

Get Our Latest Research Report on PSBD

Palmer Square Capital BDC Company Profile

(Get Free Report)

Palmer Square Capital BDC, Inc is an externally managed business development company that seeks to provide financing to private middle-market companies. The company focuses primarily on privately originated and negotiated investments in senior secured loans and other debt instruments, with the goal of supporting businesses while generating current income for shareholders.

Palmer Square Capital BDC may invest across a range of industries and capital structures, including first-lien and unitranche loans, second-lien and subordinated debt, and select equity investments.

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