Palmer Square Capital BDC Inc. (PSBD) AI Stock Analysis

• Market Cap: $415.80M
• Dividend Yield: 12.71%
• Average Volume (3M): 49.22K
• Price to Earnings (P/E): 8.7
• Beta (1Y): 0.31
• Revenue Growth: 14.82%
• EPS Growth: -63.91%
• Country: US
• Employees: N/A
• Sector: General
• Sector Strength: N/A
• Industry: Asset Management
• EPS (TTM): 1.46
• Shares Outstanding: 32,611,553
• 10 Day Avg. Volume: 36,754
• 30 Day Avg. Volume: 49,215
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• Price to Cash Flow (P/CF): N/A
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $15.25
• Price Target Upside: 19.61% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

Palmer Square Capital BDC Inc. is experiencing significant financial challenges, particularly with negative cash flows and inconsistent profitability, which weigh heavily on its overall score. While technical indicators suggest a bearish sentiment, the stock's low valuation and high dividend yield provide some upside potential. The recent earnings call highlights both opportunities and risks, with strong capital deployment countered by dividend reductions and asset losses. The company's ability to manage these challenges will be critical in determining future performance.

Positive Factors

Credit and Earnings

Credit remains strong, core earnings support supplemental dividends, and the portfolio yield improved.

Investment Strategy

PSBD's unique strategy of investing across the liquid and private markets can generate attractive risk-adjusted returns.

Negative Factors

Dividend Reduction

Lower base rates plus spread pressure drove PSBD to reduce the quarterly core dividend by 14%.

Profitability

Palmer Square reported core profitability was weaker than expected, and the core dividend was reset lower.

Palmer Square Capital BDC Inc. Business Overview & Revenue Model

Company Description

Palmer Square Capital BDC, Inc. engages in the provision of investment funds. It lends and invests in corporate debt securities of companies. The company was founded in 2019 and is headquartered in Mission Woods, KS.

How the Company Makes Money

Palmer Square Capital BDC Inc. generates revenue primarily through interest income from its debt investments in middle-market companies. The company invests in various forms of debt, including senior secured loans, subordinated debt, and mezzanine financing, which provide a steady stream of interest payments. Additionally, PSBD may earn income from equity investments in portfolio companies if they appreciate in value or generate dividends. The company's earnings are influenced by its ability to identify attractive investment opportunities, effectively manage credit risk, and maintain strong relationships with its portfolio companies.

Palmer Square Capital BDC Inc. Financial Statement Overview

Summary

Palmer Square Capital BDC Inc. faces significant challenges with inconsistent revenue and profitability, potentially due to market volatility or operational inefficiencies. The balance sheet remains relatively stable with no debt, reducing financial risk, but changes in stockholders' equity and assets suggest some instability. Negative cash flows are a critical concern, indicating potential liquidity issues.

Income Statement

Palmer Square Capital BDC Inc. has experienced significant volatility in its revenue and profitability. The company showed a negative revenue growth rate from the previous year, indicating a challenging environment. The gross profit margin is stable, but the net profit margin is inconsistent, highlighting volatility in core operations. EBIT and EBITDA margins have been highly negative, which could indicate operational inefficiencies or restructuring costs.

Balance Sheet

The balance sheet shows a moderate equity ratio, suggesting a balanced capital structure with a manageable level of leverage. The company has eliminated its total debt, significantly reducing financial risk. However, fluctuations in stockholders' equity and total assets over the years highlight potential instability. The return on equity is positive, reflecting some efficiency in generating profits from shareholders' investments.

Cash Flow

The cash flow statement indicates a challenging situation with a significant decline in operating cash flow. Free cash flow has also turned negative, raising concerns about the company's ability to generate cash internally. The operating cash flow to net income ratio is negative, reflecting inefficiencies in converting income into cash. The company has relied on financing to support cash flow, which might not be sustainable in the long term.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
52.31M	109.18M	-72.84M	20.92M	24.45M
	Gross Profit
52.31M	101.82M	-81.99M	13.52M	19.49M
	EBIT
-211.34M	-7.03M	-74.48M	19.06M	31.47M
	EBITDA
0.00	152.32M	0.00	27.68M	31.47M
	Net Income Common Stockholders
47.67M	107.84M	-74.48M	19.06M	26.73M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.77M	65.88M	1.65M	1.09M	682.58K
	Total Assets
1.43B	1.12B	1.06B	1.22B	667.49M
	Total Debt
0.00	641.83M	641.31M	649.91M	393.15M
	Net Debt
-2.77M	-2.12M	639.66M	648.82M	392.47M
	Total Liabilities
893.20M	659.86M	694.01M	764.49M	414.35M
	Stockholders Equity
537.84M	461.96M	363.44M	452.80M	253.14M
Cash Flow		Free Cash Flow
-200.60M	57.12M	25.11M	-438.01M	16.19M
	Operating Cash Flow
-200.60M	57.12M	25.11M	-438.01M	16.19M
	Investing Cash Flow
0.00	-26.65M	35.40M	-519.55M	-586.26M
	Financing Cash Flow
201.25M	-30.00M	-24.56M	438.42M	570.75M

Palmer Square Capital BDC Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 12.75
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PSBD, the sentiment is Negative. The current price of 12.75 is below the 20-day moving average (MA) of 13.07, below the 50-day MA of 14.01, and below the 200-day MA of 14.79, indicating a bearish trend. The MACD of -0.35 indicates Negative momentum. The RSI at 41.15 is Neutral, neither overbought nor oversold. The STOCH value of 31.03 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PSBD.

Palmer Square Capital BDC Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GAIN	71 Outperform	$514.62M	7.29	14.74%	6.87%	-8.68%	-3.76%
SAR	68 Neutral	$348.04M	9.68	9.28%	12.20%	-24.05%	28.25%
SCM	64 Neutral	$377.08M	7.41	13.29%	12.05%	17.67%	128.48%
CION	58 Neutral	$534.51M	15.93	3.99%	14.29%	2.30%	-63.97%
Sector *	55 Neutral	$4.17B	-1.48	-15.12%	5.19%	17.18%	-44.55%
PSBD	51 Neutral	$415.80M	8.72	9.54%	12.71%	14.82%	-63.91%
PNNT	47 Neutral	$422.47M	25.91	3.28%	14.53%	―	-66.59%

Palmer Square Capital BDC Inc. Corporate Events

Palmer Square Capital BDC Reports Q4 2024 Results

Palmer Square Capital BDC Inc. announced its financial results for the fourth quarter and full year 2024, reporting a total investment income of $34.9 million for the quarter, an increase from the previous year. Despite a decrease in net investment income per share, the company declared a first quarter 2025 base dividend of $0.36 per share, with a supplemental dividend expected in March. The company maintained a disciplined investment strategy amidst market uncertainties, focusing on liquid and private credit investments, which it believes will continue to deliver attractive returns while maintaining credit quality.