Capital Southwest (NASDAQ:CSWC) Share Price Breaks Below 200 Day Moving Average - Time to Sell?

Key Points

• Capital Southwest shares fell below their 200-day moving average, trading as low as $22.77 and last changing hands at $22.99, below the $23.56 average.
• Despite the technical weakness, analysts remain broadly positive: six rate the stock Buy and three Hold, producing a “Moderate Buy” consensus and a $23.60 average price target.
• The company reported quarterly EPS of $0.58, beating estimates, and declared a monthly dividend of $0.1934, equivalent to an annualized yield of about 10.1%.

Capital Southwest Corporation (NASDAQ:CSWC - Get Free Report) shares passed below its 200-day moving average during trading on Monday. The stock has a 200-day moving average of $23.56 and traded as low as $22.77. Capital Southwest shares last traded at $22.99, with a volume of 450,801 shares changing hands.

Analyst Upgrades and Downgrades

A number of analysts recently commented on the company. Citigroup reiterated a "market outperform" rating on shares of Capital Southwest in a research report on Wednesday, August 5th. Citizens Jmp lifted 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 report on Wednesday, August 5th. B. Riley Financial boosted their price target on shares of Capital Southwest from $24.50 to $25.50 and gave the stock a "buy" rating in a research note on Wednesday, August 5th. Finally, Weiss Ratings restated a "buy (b-)" rating on shares of Capital Southwest in a report on Monday, September 14th. Six equities research analysts have rated the stock with a Buy rating and three have assigned a Hold rating to the company's stock. Based on data from MarketBeat, Capital Southwest currently has a consensus rating of "Moderate Buy" and a consensus price target of $23.60.

Capital Southwest Trading Down 0.6%

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 business has a 50 day moving average of $24.30 and a 200 day moving average of $23.56. The firm has a market capitalization of $1.47 billion, a price-to-earnings ratio of 12.70 and a beta of 0.70.

Capital Southwest (NASDAQ:CSWC - Get Free Report) last released its earnings results on Monday, August 3rd. The asset manager reported $0.58 earnings per share 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 for the quarter, compared to analyst estimates of $61.22 million. During the same quarter in the prior year, the firm posted $0.61 earnings per share. As a group, research analysts predict that Capital Southwest Corporation will post 2.27 earnings per share for the current fiscal year.

Capital Southwest Announces Dividend

The business also recently declared a monthly dividend, which will be paid on Thursday, December 31st. Stockholders of record on Tuesday, December 15th will be paid a $0.1934 dividend. The ex-dividend date of this dividend is Tuesday, December 15th. This represents a $2.32 dividend on an annualized basis and a dividend yield of 10.1%. Capital Southwest's dividend payout ratio is 128.18%.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently bought and sold shares of CSWC. Allied Private Wealth LLC bought a new stake in Capital Southwest in the second quarter valued at approximately $37,000. Osbon Capital Management LLC acquired a new stake in Capital Southwest in the fourth quarter worth $55,000. CENTRAL TRUST Co bought a new position in shares of Capital Southwest during the first quarter worth $60,000. Burk Holdings LLC acquired a new position in shares of Capital Southwest in the 2nd quarter valued at $73,000. Finally, Northwestern Mutual Wealth Management Co. acquired a new position in shares of Capital Southwest in the 2nd quarter valued at $95,000. Institutional investors own 23.42% 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 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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