Prospect Capital Net Income vs. Return On Equity
| PSEC-PA Preferred Stock | 19.38 0.08 0.41% |
For Prospect Capital profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Prospect Capital to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Prospect Capital utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Prospect Capital's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Prospect Capital over time as well as its relative position and ranking within its peers.
Prospect |
Prospect Capital Return On Equity vs. Net Income Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Prospect Capital's current stock value. Our valuation model uses many indicators to compare Prospect Capital value to that of its competitors to determine the firm's financial worth. Prospect Capital is regarded second in net income category among its peers. It also is regarded second in return on equity category among its peers . Comparative valuation analysis is a catch-all model that can be used if you cannot value Prospect Capital by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Prospect Capital's Preferred Stock. Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued.Prospect Return On Equity vs. Net Income
Net income is the profit of a company for the reporting period, which is derived after taking revenues and gains and subtracting all expenses and losses. Net income is one of the most-watched numbers by money managers as well as individual investors.
Prospect Capital |
| = | (101.64 M) |
Because income is reported on the Income Statement of a company and is measured in dollars some investors prefer to use Profit Margin, which measures income as a percentage of sales.
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
Prospect Capital |
| = | -0.0205 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Prospect Return On Equity Comparison
Prospect Capital is currently under evaluation in return on equity category among its peers.
Prospect Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Prospect Capital. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Prospect Capital position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Prospect Capital's important profitability drivers and their relationship over time.
Use Prospect Capital in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Prospect Capital position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Prospect Capital will appreciate offsetting losses from the drop in the long position's value.Prospect Capital Pair Trading
Prospect Capital Pair Trading Analysis
The ability to find closely correlated positions to Prospect Capital could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Prospect Capital when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Prospect Capital - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Prospect Capital to buy it.
The correlation of Prospect Capital is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Prospect Capital moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Prospect Capital moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Prospect Capital can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your Prospect Capital position
In addition to having Prospect Capital in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
Run Shipping Containers Thematic Idea Now
Shipping Containers
Fama and French investing themes focus on testing asset pricing under different economic assumptions. The Shipping Containers theme has 16 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Shipping Containers Theme or any other thematic opportunities.
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Other Information on Investing in Prospect Preferred Stock
To fully project Prospect Capital's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Prospect Capital at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Prospect Capital's income statement, its balance sheet, and the statement of cash flows.