SOURCE: The Bedford Report

The Bedford Report

December 06, 2011 08:16 ET

Tight Credit Conditions Assist High Yielding Prospect Capital and Apollo Corporation

The Bedford Report Provides Equity Research on Prospect Capital & Apollo Investment

NEW YORK, NY--(Marketwire - Dec 6, 2011) - Business Development Companies (BDCs) have garnered more attention from investors in recent quarters. Although interest rates remain at historic lows, several sectors are still finding credit conditions to be tight. This had led more investors and target businesses to pursue alternative funding from BDCs. The Bedford Report examines the outlook for companies in the Business Development Company (BDC) Industry and provides stock analysis on Prospect Capital Corporation (NASDAQ: PSEC) and Apollo Investment Corporation (NASDAQ: AINV). Access to the full company reports can be found at:

BCDs traditionally provide capital to small companies -- American BDCs are required to invest at least 70 percent of assets in private US companies. These companies will typically borrow at a relatively low interest rate, and lend out capital at a much higher rate, leading to larger profits in the current economic landscape. Because BDCs are treated as regulated investment companies (RICs) they must distribute at least 90 percent of taxable income as dividends to investors. With net interest income improving, and profits on the upswing, several BCDs currently yield more ten percent.

The Bedford Report releases investment research on the Business Development Company (BDC) Industry so investors can stay ahead of the crowd and make the best investment decisions to maximize their returns. Take a few minutes to register with us free at and get exclusive access to our numerous analyst reports and industry newsletters.

During the three months ended September 30, 2011 Prospect Capital Corporation says its origination efforts focused primarily on secured lending, continuing to prioritize first-lien loans, although the company continued to close selected junior debt and equity investments. PSEC's portfolio's annualized current yield stood at 12.4 percent across all long-term debt and certain equity investments as of the third quarter. Presently the company pays an annual dividend of $1.22 per share for a hefty yield of approximately 13.2 percent.

During the three months ended September 30, 2011, Apollo Investment Corporation invested $403 million across 6 new and 8 existing portfolio companies, through a combination of primary and secondary market purchases. The Company's net investment income totaled $45.5 million, or $0.23 on a per average share basis, for the three ended September 30, 2011. Presently Apollo Investment Corporation pays an annual dividend of $1.12 per share for a yield of around 15.6 percent.

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