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Pennantpark Investment Corp. (PNNT)
NYSE:PNNT
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Pennantpark Investment
(NYSE:PNNT)
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Rating:54Neutral
Price Target:
$6.00
▲(2.74% Upside)
The overall stock score of 54 reflects mixed financial performance and bearish technical indicators, counterbalanced by attractive valuation metrics. The earnings call provides some optimism for future growth, but concerns about revenue and cash flow declines weigh heavily on the score.
Positive Factors
Strong Portfolio Performance
A strong portfolio performance indicates robust asset management and risk mitigation, ensuring long-term stability and consistent returns.
High Yield on Investments
High yields on investments suggest effective capital deployment and strong income generation, enhancing long-term profitability.
Significant Spillover Income
Significant spillover income provides a buffer to maintain dividend payouts, supporting investor confidence and financial stability.
Negative Factors
Declining Revenue Growth
A sharp decline in revenue growth can impact long-term sustainability, indicating potential challenges in maintaining competitive market position.
High Leverage Ratio
A high leverage ratio increases financial risk, potentially limiting the company's ability to invest in growth opportunities and manage economic downturns.
Net Realized and Unrealized Losses
Losses on investments can erode capital and affect future earnings potential, posing a risk to long-term financial health.
Pennantpark Investment (PNNT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$381.33M
Dividend Yield16.44%
Average Volume (3M)669.88K
Price to Earnings (P/E)11.7
Beta (1Y)0.43
Revenue Growth-3.09%
EPS Growth200.66%
CountryUS
EmployeesN/A
SectorFinancial
Sector Strength70
IndustryAsset Management
Share Statistics
EPS (TTM)0.15
Shares Outstanding65,296,100
10 Day Avg. Volume1,010,844
30 Day Avg. Volume669,877
Financial Highlights & Ratios
PEG Ratio-0.40
Price to Book (P/B)0.94
Price to Sales (P/S)6.26
P/FCF Ratio4.18
Enterprise Value/Market Cap2.95
Enterprise Value/Revenue11.17
Enterprise Value/Gross Profit27.71
Enterprise Value/Ebitda14.62
Forecast
1Y Price Target
$5.88Price Target Upside0.68% Upside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)0.65
Revenue Forecast (FY)$112.66M
Pennantpark Investment Business Overview & Revenue Model
Company DescriptionPennantPark Investment Corporation (PNNT) is a publicly traded business development company that primarily focuses on providing debt and equity financing to middle-market companies in the United States. Established in 2007, PennantPark specializes in a variety of sectors including technology, healthcare, and consumer services, offering a range of financial products such as senior secured loans, mezzanine debt, and equity co-investments.
How the Company Makes MoneyPennantPark generates revenue primarily through interest income from the loans and debt securities it provides to portfolio companies. The company earns interest on its investments, which typically have fixed or floating rates, and also collects fees for arranging and managing these investments. In addition to interest income, PennantPark can generate capital gains from equity investments when portfolio companies are sold or go public. The company's revenue model is bolstered by its relationships with private equity firms and other financial institutions, which can lead to deal flow and co-investment opportunities. The management fees from its investment activities also contribute to its earnings, providing a consistent revenue stream.
Pennantpark Investment Earnings Call Summary
Earnings Call Date:Nov 24, 2025
(Q4-2025)
| % Change Since: |
Next Earnings Date:Feb 11, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with positive aspects such as increased transaction activity, strong portfolio performance, and significant spillover income. However, these are counterbalanced by challenges like a decrease in NAV, a high leverage ratio, and net losses on investments.Q4-2025 Updates
Positive Updates
Steady Increase in Transaction Activity
The company is encouraged by a steady increase in transaction activity, which is expected to translate into higher loan origination volumes in the coming quarters.
Strong Portfolio Performance
The credit quality of the portfolio continues to perform well with 4 nonaccrual investments representing only 1.3% of the portfolio at cost and 0.1% at market value.
Significant Spillover Income
The company has $48 million or $0.73 per share of undistributed spillover income, which can cover shortfalls in net investment income versus the dividend.
High Yield on Investments
The weighted average yield on debt investments was 11%, and the JV portfolio had an average NII yield of 17%.
Negative Updates
Decrease in Net Asset Value
NAV decreased by 3.4% from $7.36 per share in the prior quarter to $7.11 per share as of September 30.
High Leverage Ratio
The debt-to-equity ratio was 1.6x, which is higher than the target range of 1.25 to 1.3x.
Net Realized and Unrealized Losses
There was a net realized and unrealized change on investments and debt, including provision for taxes, resulting in a loss of $10.8 million.
Company Guidance
In the fourth fiscal quarter of 2025, PennantPark Investment Corporation reported a core net investment income of $0.15 per share against total distributions of $0.24 per share. The company is focusing on rotating out of equity positions to reinvest in interest-bearing debt, which is expected to boost core net investment income. As of September 30, 2025, PennantPark had $48 million, or $0.73 per share, of undistributed spillover income, which they plan to use to cover any shortfalls in net investment income relative to the dividend. The portfolio, valued at $1.3 billion, demonstrated strong credit quality with a median leverage ratio of 4.5x and interest coverage ratio of 2x. The weighted average yield on debt investments stood at 11%, and 91% of the portfolio was in floating rate debt. The company is optimistic about increasing transaction activity and loan origination volumes, particularly in the core middle market where first lien loans are priced at SOFR plus 4.75% to 5.25%. Over the last 12 months, PennantPark's joint venture portfolio, valued at $1.3 billion, provided an average NII yield of 17%. The company aims to maintain a leverage ratio of 1.25 to 1.3x and is exploring asset sales to reduce leverage from the current 1.6x.Pennantpark Investment Financial Statement Overview
Summary
Pennantpark Investment exhibits a mixed financial position characterized by inconsistent income and cash flow performance and high leverage, posing potential risks. While there are some positive elements, such as improved TTM net income, overall stability and growth remain concerns.Income Statement
The income statement shows mixed performance with a positive TTM net income but a negative EBIT indicating challenges in operational efficiency. Revenue growth is inconsistent with significant fluctuations year-over-year.45
Neutral
Balance Sheet
The balance sheet reflects high leverage with a substantial debt-to-equity ratio, indicating potential financial risk. Equity has decreased over the period, impacting the company's stability.60
Neutral
Cash Flow
Cash flow statements reveal volatility, with inconsistent operating cash flow trends. The operating cash flow to net income ratio shows potential issues in cash generation relative to profitability.50
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 100.74M | 69.94M | 69.94M | 143.82M | 145.37M | 104.97M |
| Gross Profit | 40.61M | 42.15M | 42.15M | 58.51M | 145.37M | -4.96M |
| EBITDA | 76.95M | 76.95M | 76.95M | 51.95M | 0.00 | -16.86M |
| Net Income | 32.73M | 32.73M | 32.73M | 48.85M | -33.81M | -24.74M |
Balance Sheet | ||||||
| Total Assets | 1.35B | 1.35B | 1.35B | 1.39B | 1.16B | 1.32B |
| Cash, Cash Equivalents and Short-Term Investments | 51.78M | 51.78M | 51.78M | 49.86M | 38.77M | 54.77M |
| Total Debt | 738.88M | 149.47M | 149.47M | 772.01M | 516.84M | 704.51M |
| Total Liabilities | 885.60M | 885.60M | 885.60M | 895.18M | 654.79M | 735.05M |
| Stockholders Equity | 463.95M | 463.95M | 463.95M | 493.91M | 502.19M | 585.57M |
Cash Flow | ||||||
| Free Cash Flow | 229.83M | 104.78M | 104.78M | -172.40M | 222.94M | -17.29M |
| Operating Cash Flow | 229.83M | 104.78M | 104.78M | -172.40M | 222.94M | -17.29M |
| Investing Cash Flow | -80.68M | 38.66M | 38.66M | 0.00 | 0.00 | 0.00 |
| Financing Cash Flow | -102.91M | -102.91M | -102.91M | 183.43M | -239.16M | 52.04M |
Pennantpark Investment Technical Analysis
Negative
5.84
Price Trends
6.36
Negative
6.67
Negative
6.50
Negative
Market Momentum
-0.18
Positive
34.22
Neutral
16.34
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PNNT, the sentiment is Negative. The current price of 5.84 is below the 20-day moving average (MA) of 6.18, below the 50-day MA of 6.36, and below the 200-day MA of 6.50, indicating a bearish trend. The MACD of -0.18 indicates Positive momentum. The RSI at 34.22 is Neutral, neither overbought nor oversold. The STOCH value of 16.34 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PNNT.
Pennantpark Investment Risk Analysis
Pennantpark Investment disclosed 85 risk factors in its most recent earnings report. Pennantpark Investment reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Pennantpark Investment Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $325.56M | 5.08 | 17.74% | 6.74% | 6.38% | 25.69% | |
70 Neutral | $478.97M | 8.40 | 11.86% | 10.78% | 41.12% | -40.68% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
64 Neutral | $365.02M | 11.58 | 8.20% | 12.69% | 90.34% | -44.25% | |
58 Neutral | $517.53M | ― | -1.15% | 21.48% | -91.81% | 78.46% | |
58 Neutral | $513.61M | 19.65 | 3.22% | 14.99% | -11.01% | -65.56% | |
54 Neutral | $381.33M | 11.65 | 6.83% | 16.44% | -3.09% | 200.66% |
* Financial Sector Average
PNNT
Pennantpark Investment
5.84
-0.25
-4.11%
GLAD
Gladstone Capital
21.20
-4.10
-16.21%
NEWT
Newtek Business
11.27
-2.01
-15.14%
SCM
Stellus Capital
12.61
0.32
2.60%
TCPC
BlackRock TCP Capital
6.10
-1.94
-24.13%
CION
CION Investment Corp
9.94
-0.13
-1.29%
Pennantpark Investment Corporate Events
Dividends
PennantPark Announces December 2025 Distribution
Positive
Dec 2, 2025
On December 2, 2025, PennantPark Investment Corporation announced a monthly distribution of $0.08 per share for December 2025, payable on January 2, 2026, to stockholders of record as of December 15, 2025. This distribution is expected to be paid from taxable net investment income, with the final tax characteristics to be reported after the calendar year ends. This announcement reflects the company’s ongoing commitment to providing returns to its shareholders and may influence its market positioning by demonstrating financial stability and shareholder value.
Dividends
PennantPark Announces November 2025 Distribution
Positive
Nov 4, 2025
On November 4, 2025, PennantPark Investment Corporation announced a monthly distribution of $0.08 per share for November 2025, payable on December 1, 2025, to stockholders of record as of November 17, 2025. This distribution is expected to be paid from taxable net investment income, and the final tax characteristics will be reported after the calendar year. This announcement reflects the company’s ongoing commitment to providing returns to its shareholders and maintaining its position in the middle-market investment sector.
Financial Disclosures
PennantPark Investment Announces Upcoming Earnings Release
Neutral
Oct 3, 2025
On October 3, 2025, PennantPark Investment Corporation announced its plan to release its fourth fiscal quarter earnings for the period ending September 30, 2025, on November 24, 2025, after market close. The company will host a conference call on November 25, 2025, to discuss the results, highlighting its continued focus on middle-market investments and its strategic positioning in the financial sector.
Dividends
PennantPark Announces October 2025 Dividend Distribution
Positive
Oct 2, 2025
On October 2, 2025, PennantPark Investment Corporation announced its monthly distribution for October 2025, declaring a dividend of $0.08 per share. This distribution is payable on November 3, 2025, to stockholders of record as of October 15, 2025, and is expected to be paid from taxable net investment income. This announcement reflects the company’s ongoing commitment to providing returns to its shareholders and may impact its financial performance and investor relations.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.