Capital Southwest Corporation (NASDAQ:CSWC) Stock Now Rated "Moderate Buy" by Sell-Side Analysts

Key Points

• Analysts rate Capital Southwest “Moderate Buy”: Six of eight analysts recommend buying the stock, while two recommend holding it. The average 12-month price target is $24.10, with several firms recently raising their targets.
• Capital Southwest reported quarterly EPS of $0.58, exceeding the $0.56 consensus estimate, though revenue of $61.05 million narrowly missed expectations.
• The company announced a monthly dividend of $0.1934 per share, equivalent to an annualized $2.32 and a 9.9% yield. A director also purchased nearly $50,000 of company stock, while institutional investors own 23.42% of shares.

Capital Southwest Corporation (NASDAQ:CSWC - Get Free Report) has earned an average rating of "Moderate Buy" from the eight analysts that are currently covering the stock, Marketbeat.com reports. Two equities research analysts have rated the stock with a hold recommendation and six have assigned a buy recommendation to the company. The average 1 year target price among analysts that have updated their coverage on the stock in the last year is $24.10.

Several research firms recently issued reports on CSWC. UBS Group lifted their price target on shares of Capital Southwest from $23.50 to $24.00 and gave the company a "neutral" rating in a research report on Friday. Citigroup restated a "market outperform" rating on shares of Capital Southwest in a research note on Wednesday, August 5th. Citizens Jmp upped their price objective on shares of Capital Southwest from $25.00 to $26.00 and gave the stock a "market outperform" rating in a report on Wednesday, August 5th. Weiss Ratings raised shares of Capital Southwest from a "buy (b-)" rating to a "buy (b)" rating in a research note on Monday, September 28th. Finally, B. Riley Financial raised their price objective on shares of Capital Southwest from $24.50 to $25.50 and gave the company a "buy" rating in a research note on Wednesday, August 5th.

Capital Southwest Price Performance

Shares of NASDAQ:CSWC opened at $23.54 on Monday. The company has a debt-to-equity ratio of 0.62, a quick ratio of 0.17 and a current ratio of 0.17. Capital Southwest has a 52-week low of $19.37 and a 52-week high of $25.75. The business's 50 day simple moving average is $24.27 and its two-hundred day simple moving average is $23.67. The firm has a market cap of $1.50 billion, a P/E ratio of 13.01 and a beta of 0.71.

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

Capital Southwest Announces Dividend

The firm also recently announced a monthly dividend, which will be paid on Thursday, December 31st. Stockholders of record on Tuesday, December 15th will be given a dividend of $0.1934 per share. The ex-dividend date of this dividend is Tuesday, December 15th. This represents a $2.32 annualized dividend and a dividend yield of 9.9%. Capital Southwest's payout ratio is presently 128.18%.

Insider Buying and Selling at Capital Southwest

In other Capital Southwest news, Director William Thomas, III bought 2,170 shares of the stock in a transaction that occurred on Thursday, October 1st. The shares were bought at an average price of $23.04 per share, for a total transaction of $49,996.80. Following the acquisition, the director directly owned 22,842 shares of the company's stock, valued at approximately $526,279.68. The trade was a 10.50% increase in their position. The acquisition was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. 2.70% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On Capital Southwest

A number of hedge funds have recently added to or reduced their stakes in CSWC. Leonteq Securities AG raised its holdings in shares of Capital Southwest by 11.1% in the first quarter. Leonteq Securities AG now owns 7,000 shares of the asset manager's stock valued at $155,000 after purchasing an additional 700 shares during the last quarter. Allworth Financial LP boosted its holdings in Capital Southwest by 16.9% during the second quarter. Allworth Financial LP now owns 6,535 shares of the asset manager's stock worth $155,000 after purchasing an additional 947 shares during the last quarter. Symphony Financial Ltd. Co. boosted its holdings in Capital Southwest by 2.9% during the second quarter. Symphony Financial Ltd. Co. now owns 42,154 shares of the asset manager's stock worth $991,000 after purchasing an additional 1,185 shares during the last quarter. Squarepoint Ops LLC grew its position in Capital Southwest by 12.5% in the 2nd quarter. Squarepoint Ops LLC now owns 10,845 shares of the asset manager's stock worth $258,000 after purchasing an additional 1,208 shares in the last quarter. Finally, Sunbelt Securities Inc. grew its position in Capital Southwest by 4.3% in the 1st quarter. Sunbelt Securities Inc. now owns 37,030 shares of the asset manager's stock worth $819,000 after purchasing an additional 1,530 shares in the last quarter. Institutional investors and hedge funds own 23.42% of the company's stock.

Capital Southwest Company Profile

Capital Southwest Corporation NASDAQ: CSWC is an internally managed business development company (BDC) that provides financing and investment solutions to middle-market companies. The company primarily invests in privately held businesses through secured debt, including first-lien, second-lien and unitranche loans, as well as subordinated debt and equity investments.

Capital Southwest generally focuses on established lower-middle-market companies in the United States. Its portfolio companies operate across a range of industries, and the company seeks to support acquisitions, recapitalizations, growth initiatives and other strategic or general corporate purposes through customized financing arrangements.

Founded in 1961, Capital Southwest has a long history as an investment company and operates under the regulatory framework governing BDCs.

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