Capital Southwest Corporation (NASDAQ:CSWC) Receives Average Recommendation of "Moderate Buy" from Brokerages

Key Points

• Analyst sentiment is moderately bullish: Six of nine brokerages rate Capital Southwest a buy and three recommend holding the stock, with an average 12-month price target of $23.60.
• Capital Southwest reported quarterly EPS of $0.58, beating estimates of $0.56, while revenue of $61.05 million came slightly below expectations.
• The company announced a monthly dividend of $0.1934 per share, representing an approximately 9.8% annualized yield; institutional investors own 23.42% of the stock.

Capital Southwest Corporation (NASDAQ:CSWC - Get Free Report) has received an average recommendation of "Moderate Buy" from the nine research firms that are currently covering the stock, MarketBeat reports. Three analysts have rated the stock with a hold rating and six have assigned a buy rating to the company. The average 1-year target price among brokerages that have updated their coverage on the stock in the last year is $23.60.

Several equities analysts have recently issued reports on CSWC shares. Citigroup restated a "market outperform" rating on shares of Capital Southwest in a report on Wednesday, August 5th. Weiss Ratings reiterated a "buy (b-)" rating on shares of Capital Southwest in a research note on Thursday, June 18th. B. Riley Financial boosted their target price on shares of Capital Southwest from $24.50 to $25.50 and gave the stock a "buy" rating in a research report on Wednesday, August 5th. Finally, Citizens Jmp upped their price target on shares of Capital Southwest from $25.00 to $26.00 and gave the company a "market outperform" rating in a research note on Wednesday, August 5th.

Institutional Trading of Capital Southwest

Several large investors have recently added to or reduced their stakes in the company. Sequoia Financial Advisors LLC acquired a new position in shares of Capital Southwest in the second quarter valued at about $210,000. Arlington Capital Management Inc. lifted its holdings in shares of Capital Southwest by 12.2% during the second quarter. Arlington Capital Management Inc. now owns 24,202 shares of the asset manager's stock worth $575,000 after purchasing an additional 2,637 shares during the period. Squarepoint Ops LLC boosted its position in Capital Southwest by 12.5% in the second quarter. Squarepoint Ops LLC now owns 10,845 shares of the asset manager's stock valued at $258,000 after buying an additional 1,208 shares during the last quarter. Allworth Financial LP boosted its position in Capital Southwest by 16.9% in the second quarter. Allworth Financial LP now owns 6,535 shares of the asset manager's stock valued at $155,000 after buying an additional 947 shares during the last quarter. Finally, Amundi acquired a new position in Capital Southwest in the 2nd quarter worth approximately $316,000. Hedge funds and other institutional investors own 23.42% of the company's stock.

Capital Southwest Stock Down 1.1%

Capital Southwest stock opened at $23.60 on Thursday. Capital Southwest has a 1-year low of $19.37 and a 1-year high of $25.75. The business has a fifty day moving average price of $24.40 and a 200-day moving average price of $23.51. The company has a debt-to-equity ratio of 0.62, a current ratio of 0.17 and a quick ratio of 0.17. The stock has a market capitalization of $1.50 billion, a price-to-earnings ratio of 13.04 and a beta of 0.70.

Capital Southwest (NASDAQ:CSWC - Get Free Report) last announced its earnings results on Monday, August 3rd. The asset manager reported $0.58 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.56 by $0.02. The company had revenue of $61.05 million for the quarter, compared to analyst estimates of $61.22 million. Capital Southwest had a return on equity of 13.88% and a net margin of 46.68%.During the same period in the prior year, the company posted $0.61 EPS. Equities research analysts forecast that Capital Southwest will post 2.27 EPS for the current fiscal year.

Capital Southwest Dividend Announcement

The company also recently announced a monthly dividend, which will be paid on Thursday, December 31st. Investors of record on Tuesday, December 15th will be paid a $0.1934 dividend. The ex-dividend date is Tuesday, December 15th. This represents a c) dividend on an annualized basis and a yield of 9.8%. Capital Southwest's dividend payout ratio (DPR) is 128.18%.

About Capital Southwest

Capital Southwest Corporation NASDAQ: CSWC is a business development company that provides financing to middle-market and lower-middle-market businesses in the United States. The company invests primarily in privately held companies and seeks to support their growth, acquisitions, recapitalizations and other strategic initiatives.

Capital Southwest's investment activities generally include first-lien and second-lien loans, unitranche financing, subordinated debt and, in some cases, equity investments.

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