Palmer Square Capital BDC (NYSE:PSBD) Releases Quarterly Earnings Results, Misses Estimates By $0.16 EPS

Palmer Square Capital BDC (NYSE:PSBD) posted its earnings results on Wednesday. The company reported $0.27 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.43 by ($0.16), FiscalAI reports. Palmer Square Capital BDC had a positive return on equity of 10.91% and a negative net margin of 26.73%.The business had revenue of $13.06 million for the quarter, compared to the consensus estimate of $25.97 million.

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

• Palmer Square Capital BDC generated $0.39 per share of net investment income in the second quarter, matching its $0.39 per-share dividend, including a $0.03 supplemental payment. The board declared a third-quarter base dividend of $0.36 per share.
• Net investment income declined to $12.0 million from $13.8 million a year earlier, primarily reflecting lower base rates, while NAV per share fell to $13.21 from $13.30 amid valuation declines in broadly syndicated loans.
• Management reported resilient credit performance, including a low 0.29% non-accrual rate, a portfolio that is 96% senior secured, diversified across 45 industries, and PIK income equal to only 1.37% of total investment income.
• The company expanded its share repurchase authorization to $30 million, with approximately $4 million used through the second quarter, and expects to deploy the program meaningfully while maintaining appropriate leverage.
• PSBD reset and extended its BDC CLO, reducing the weighted-average debt cost to SOFR plus 1.39% from 1.72% and extending the reinvestment period to 2031; management expects the transaction to be fully accretive beginning in the fourth quarter. Investment activity remains subdued, but discounted liquid-loan and wider-spread private-credit opportunities are emerging.

Palmer Square Capital BDC Trading Down 0.4%

Shares of PSBD traded down $0.04 during midday trading on Friday, reaching $10.42. The stock had a trading volume of 179,869 shares, compared to its average volume of 113,622. The firm has a market cap of $324.27 million, a PE ratio of -10.53 and a beta of 0.84. The firm has a 50 day simple moving average of $10.35 and a 200-day simple moving average of $10.69. Palmer Square Capital BDC has a one year low of $9.34 and a one year high of $14.43.

Palmer Square Capital BDC Announces Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Tuesday, October 13th. Stockholders of record on Friday, September 25th will be given a $0.36 dividend. This represents a $1.44 dividend on an annualized basis and a dividend yield of 13.8%. The ex-dividend date of this dividend is Friday, September 25th. Palmer Square Capital BDC’s dividend payout ratio (DPR) is -138.46%.

Analyst Ratings Changes

PSBD has been the subject of several research reports. Royal Bank Of Canada lowered their price objective on shares of Palmer Square Capital BDC from $12.00 to $11.00 and set a “sector perform” rating for the company in a research report on Wednesday, May 27th. Wells Fargo & Company set a $11.50 target price on shares of Palmer Square Capital BDC in a research note on Wednesday, June 24th. Zacks Research cut Palmer Square Capital BDC from a “hold” rating to a “strong sell” rating in a report on Friday, May 22nd. JPMorgan Chase & Co. dropped their price target on Palmer Square Capital BDC from $10.00 to $9.50 and set a “neutral” rating on the stock in a research note on Thursday, July 2nd. Finally, Noble Financial assumed coverage on Palmer Square Capital BDC in a report on Wednesday, June 24th. They issued a “neutral” rating on the stock. Four analysts have rated the stock with a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat, the stock has a consensus rating of “Reduce” and an average target price of $10.75.

Insider Activity

In other news, major shareholder Martin C. Bicknell bought 21,484 shares of the business’s stock in a transaction that occurred on Tuesday, July 7th. The stock was acquired at an average cost of $10.47 per share, for a total transaction of $224,937.48. Following the purchase, the insider owned 373,472 shares of the company’s stock, valued at approximately $3,910,251.84. This trade represents a 6.10% increase in their position. The transaction was disclosed in a document filed with the SEC, which is accessible through this link. Over the last quarter, insiders have bought 108,472 shares of company stock valued at $1,155,558. 1.10% of the stock is currently owned by corporate insiders.

Institutional Trading of Palmer Square Capital BDC

Several institutional investors and hedge funds have recently bought and sold shares of the business. Rivernorth Capital Management LLC acquired a new position in shares of Palmer Square Capital BDC during the 4th quarter worth approximately $7,077,000. Renaissance Technologies LLC lifted its holdings in Palmer Square Capital BDC by 18.8% during the 4th quarter. Renaissance Technologies LLC now owns 183,000 shares of the company’s stock valued at $2,231,000 after purchasing an additional 28,900 shares during the last quarter. Millennium Management LLC lifted its holdings in Palmer Square Capital BDC by 2.0% during the 3rd quarter. Millennium Management LLC now owns 134,249 shares of the company’s stock valued at $1,647,000 after purchasing an additional 2,638 shares during the last quarter. Bank of America Corp DE boosted its position in Palmer Square Capital BDC by 22.1% during the third quarter. Bank of America Corp DE now owns 367,035 shares of the company’s stock worth $4,504,000 after purchasing an additional 66,460 shares during the period. Finally, Trexquant Investment LP increased its holdings in shares of Palmer Square Capital BDC by 17.6% in the fourth quarter. Trexquant Investment LP now owns 50,118 shares of the company’s stock valued at $611,000 after purchasing an additional 7,496 shares during the last quarter. Institutional investors own 6.52% of the company’s stock.

Palmer Square Capital BDC Company Profile

Palmer Square Capital BDC Inc (NYSE: PSBD) is a closed-end, externally managed business development company that provides customized financing solutions to middle-market companies in the United States. The firm offers a broad range of debt and equity products—including first-lien and second-lien senior secured loans, unitranche financings, mezzanine debt and equity co-investments—to support corporate acquisitions, refinancings, growth initiatives and balance sheet restructurings.

PSBD primarily targets established privately owned and sponsored businesses across diverse industries such as healthcare, business services, industrials and consumer products.