Capital Southwest (NASDAQ:CSWC) Posts Quarterly Earnings Results

Key Points

• Capital Southwest reported quarterly EPS of $0.33, missing the $0.57 analyst consensus by $0.24, while revenue of $67.16 million exceeded estimates of $65.61 million.
• The company declared a monthly dividend of $0.1934 per share, equivalent to $2.32 annually and a 9.9% dividend yield; its payout ratio stands at 128.18%.
• Shares rose 1.1% to $23.43, while analysts maintained a “Moderate Buy” consensus with an average price target of $24.10. A company director also purchased nearly $50,000 of stock.

Capital Southwest (NASDAQ:CSWC - Get Free Report) posted its quarterly earnings results on Monday. The asset manager reported $0.33 earnings per share for the quarter, missing analysts' consensus estimates of $0.57 by ($0.24), FiscalAI reports. The company had revenue of $67.16 million for the quarter, compared to analyst estimates of $65.61 million. Capital Southwest had a return on equity of 13.88% and a net margin of 46.68%.

Capital Southwest Trading Up 1.1%

Shares of CSWC traded up $0.26 during mid-day trading on Monday, hitting $23.43. The company had a trading volume of 416,723 shares, compared to its average volume of 635,103. Capital Southwest has a 1-year low of $19.91 and a 1-year high of $25.75. The business's 50-day simple moving average is $23.72 and its 200-day simple moving average is $23.40. The stock has a market cap of $1.49 billion, a PE ratio of 12.94 and a beta of 0.67. The company has a quick ratio of 0.17, a current ratio of 0.17 and a debt-to-equity ratio of 0.62.

Capital Southwest Announces Dividend

The business also recently announced a monthly dividend, which will be paid on Thursday, December 31st. Investors of record on Tuesday, December 15th will be given a $0.1934 dividend. 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 dividend payout ratio (DPR) is currently 128.18%.

Wall Street Analysts Forecast Growth

CSWC has been the topic of a number of analyst reports. Citigroup reiterated a "market outperform" rating on shares of Capital Southwest in a report on Wednesday, August 5th. UBS Group upped their target price on shares of Capital Southwest from $23.50 to $24.00 and gave the company a "neutral" rating in a report on Friday, October 9th. Citizens Jmp raised their price target on shares of Capital Southwest from $25.00 to $26.00 and gave the stock a "market outperform" rating in a research note on Wednesday, August 5th. B. Riley Financial lifted their price target on shares of Capital Southwest from $24.50 to $25.50 and gave the stock a "buy" rating in a report on Wednesday, August 5th. Finally, Weiss Ratings lowered shares of Capital Southwest from a "buy (b)" rating to a "buy (b-)" rating in a research report on Tuesday, October 13th. Six investment analysts have rated the stock with a Buy rating and two have issued a Hold rating to the company's stock. Based on data from MarketBeat.com, the stock has an average rating of "Moderate Buy" and a consensus price target of $24.10.

Insider Buying and Selling

In related news, Director William Thomas, III purchased 2,170 shares of the business's stock in a transaction on Thursday, October 1st. The shares were bought at an average price of $23.04 per share, with a total value of $49,996.80. Following the completion of the purchase, the director directly owned 22,842 shares in the company, valued at approximately $526,279.68. This trade represents a 10.50% increase in their position. The acquisition was disclosed in a filing with the SEC, which is available at this hyperlink. Company insiders own 2.70% of the company's stock.

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 primarily invests in privately held companies that may require capital to support growth, acquisitions, recapitalizations, ownership transitions, or other strategic initiatives.

Its investment portfolio generally consists of senior secured loans, including first-lien and second-lien debt, as well as subordinated debt and equity investments.

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