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Actionable news in PSEC: Prospect Capital Corporation,

Prospect Capital Lawsuit Really Not A Big Deal


Current lawsuit really doesn't mean much for shareholders.

PSEC's excessive management fees are already factored into the price.

There is no chance for the stock price to drop further as a result of management fees.

PSEC is getting sued - oh no. By this point, most of you have seen and read this recent SEC filing and without going too much into it, the suit basically reads "PSEC's management fees are too damn high".

But what does this actually mean for shareholders??

In my opinion, not much, and certainly not a reason to sell as suggested by some other authors and commentors on SA. Lets take a look at a some possible outcome scenarios for this lawsuit.

Suit is dismissed or drags on indefinitely and we return to status quo - This is more than likely the outcome of this lawsuit as there is not enough substantive evidence to suggest that PSEC has fraudulently manipulated the books in order to increase their management fees. Even in the off-chance that the lawsuit can put forward some compelling evidence, PSEC management has the resources to drag this on indefinitely. For shareholders, this outcome will mean PSEC...