25 High Dividend Stocks Being Targeted By Short Sellers

17. Prospect Capital Corporation (NASDAQ:PSEC)

Short % of Float as of April 15: 7.05%

Dividend Yield as of April 28: 14.75%

Prospect Capital Corporation (NASDAQ:PSEC) is a New York-based business development company that invests in debt and equity in US middle-market businesses across various industries, aiming to provide consistent and attractive returns to its shareholders. The company’s high dividend yield, coupled with last year’s dividend cut, has made it an appealing target for short sellers. While it continues to pay dividends monthly, the reduction in dividends didn’t sit well with income investors. Since the start of 2025, the stock has declined by over 14%.

In the fourth quarter of 2024, Prospect Capital Corporation (NASDAQ:PSEC) reported revenue of $185.4 million, down by over 12% from the same period last year. The revenue also missed analysts’ estimates by $4.2 million. Payment-in-kind income dropped to $20 million, representing a 39% decline from the previous quarter and nearly a 50% decrease compared to June 2024. The company also carries long-term debt obligations that are scheduled to be repaid over the next 27 years. Additionally, PSEC has committed to $62 million in future investments, though it retains discretion over $29 million of that amount.

However, Prospect Capital Corporation (NASDAQ:PSEC)’s EPS of $0.20 beat the consensus by $0.06. Interest income made up 91% of the company’s total investment income, highlighting the strength of its recurring revenue stream. Moreover, despite announcing a dividend cut last year, the company has maintained regular payouts for 94 months. Currently, it pays a monthly dividend of $0.045 per share and has a dividend yield of 14.75%, as of April 28.