PNNTG - The Broken Safety-In-Dividend Promise Of PennantPark Investment

• As a Business Development Company, PNNT must distribute at least 90% of its income to investors.
• High distributions and management fees leave little to compensate for write-offs and defaults, pushing PNNT to raise capital through debt and equity.
• Repeated capital raises increase leverage and dilute NAV, hindering the viability of PNNT as a long-term, passive-income investment.
• Contrary to popular opinion, the best way to invest in BDCs is to strategically buy low and sell high rather than holding shares for the long run.
• PNNT shares increased in the past months as investors gained more clarity on the extent of COVID's economic disruptions, creating an attractive exit opportunity.

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