(CSWC) Capital Southwest - NASDAQ
Sector: Financial Services | Industry: Asset Management | Exchange: NASDAQ (USA) | Market Cap: 1.444m USD | Total Return: 21.3% in 12m
Avg Turnover: 14.0M
EPS Trend: -39.2%
Qual. Beats: 0
Rev. Trend: 95.9%
Qual. Beats: 0
Warnings
Share dilution 22.0% YoY
Fakeout Below Avwap Earnings
Tailwinds
No distinct edge detected
Capital Southwest Corporation (CSWC) is a Business Development Company (BDC) that provides financing to lower middle market companies through a mix of credit and equity investments. BDCs are regulated under the Investment Company Act of 1940 and are generally required to distribute the bulk of their taxable income as dividends, which is a defining feature of the business model.
The firm structures its investments primarily through debt instruments, including unitranche, senior, subordinated, first and second lien debt, alongside preferred and common equity. Equity participation is capped at roughly 20% of the total check size, and the firm only takes non-control positions. It explicitly avoids startups, public companies, real estate, oil and gas exploration, and distressed or turnaround situations.
Although industry agnostic overall, CSWC concentrates on industrial manufacturing and services, value-added distribution, healthcare, business services, specialty chemicals, food and beverage, and tech-enabled services and SaaS models. Within its three priority verticals, energy services and products, industrial technologies, and specialty chemicals and products, the firm targets specific niches such as drilling and completion chemicals, automation and process controls, and industrial filtration.
- Floating-rate loan portfolio benefits from higher rate environment
- Non-accrual rate trends reveal portfolio credit quality direction
- Net investment income growth supports dividend coverage and NAV accretion
| Net Income: 113.0m TTM > 0 and > 6% of Revenue |
| FCF/TA: -0.03 > 0.02 and ΔFCF/TA 9.32 > 1.0 |
| NWC/Revenue: 29.11% < 20% (prev 40.01%; Δ -10.89% < -1%) |
| CFO/TA -0.03 > 3% & CFO -66.0m > Net Income 113.0m |
| Net Debt (1.10b) to EBITDA (144.5m): 7.62 < 3 |
| Current Ratio: error (cannot be calculated; needs correct Total Current Assets and Liabilities) |
| Outstanding Shares: last quarter (62.5m) vs 12m ago 22.01% < -2% |
| Gross Margin: 93.72% > 18% (prev 66.45%; Δ 27.27% > 0.5%) |
| Asset Turnover: 11.20% > 50% (prev 9.16%; Δ 2.04% > 0%) |
| Interest Coverage Ratio: 2.06 > 6 (EBIT TTM 137.6m / Interest Expense TTM 66.6m) |
| A: 0.03 (Total Current Assets 64.6m - Total Current Liabilities 0.0) / Total Assets 2.18b |
| B: -0.04 (Retained Earnings -79.0m / Total Assets 2.18b) |
| C: 0.07 (EBIT TTM 137.6m / Avg Total Assets 1.98b) |
| D: 0.87 (Book Value of Equity 1.01b / Total Liabilities 1.17b) |
| Altman-Z'' = 1.45 = BB |
As of June 22, 2026, the stock is trading at USD 22.98 with a total of 816,300 shares traded. Over the past week, the price has changed by -0.81%, over one month by +0.65%, over three months by +7.32% and over the past year by +21.31%.
Current recommended Stop Loss: 22.30 (which is 3% or 1.7 ATR below the current price).
Capital Southwest has received a consensus analysts rating of 3.71. Therefore, it is recommended to hold CSWC.
- StrongBuy: 2
- Buy: 1
- Hold: 4
- Sell: 0
- StrongSell: 0
| Analysts Target Price | 24.9 | 8.4% |
P/E Trailing = 12.2263
P/E Forward = 10.9529
P/S = 6.2193
P/B = 1.4278
P/EG = 12.5385
Revenue TTM = 222.0m USD
EBIT TTM = 137.6m USD
EBITDA TTM = 144.5m USD
Long Term Debt = unknown (none)
Short Term Debt = 224.2m USD (from shortTermDebt, two quarters ago)
Debt = 1.13b USD (from shortLongTermDebtTotal, last quarter)
Net Debt = 1.10b USD (calculated: Debt 1.13b - CCE 29.4m)
Enterprise Value = 2.55b USD (1.44b + Debt 1.13b - CCE 29.4m)
Interest Coverage Ratio = 2.06 (Ebit TTM 137.6m / Interest Expense TTM 66.6m)
EV/FCF = -38.22x (Enterprise Value 2.55b / FCF TTM -66.6m)
FCF Yield = -2.62% (FCF TTM -66.6m / Enterprise Value 2.55b)
FCF Margin = -29.99% (FCF TTM -66.6m / Revenue TTM 222.0m)
Net Margin = 50.89% (Net Income TTM 113.0m / Revenue TTM 222.0m)
Gross Margin = 93.72% ((Revenue TTM 222.0m - Cost of Revenue TTM 13.9m) / Revenue TTM)
Gross Margin QoQ = none% (prev 70.86%)
Tobins Q-Ratio = 1.17 (Enterprise Value 2.55b / Total Assets 2.18b)
Interest Expense / Debt = 5.89% (Interest Expense 66.6m / Debt 1.13b)
Taxrate = 6.06% (7.29m / 120.3m)
NOPAT = 129.2m (EBIT 137.6m * (1 - 6.06%))
Current Ratio = unknown (Total Current Assets 64.6m / Total Current Liabilities 0.0)
Debt / Equity = 1.12 (Debt 1.13b / totalStockholderEquity, last quarter 1.01b)
Debt / EBITDA = 7.62 (Net Debt 1.10b / EBITDA 144.5m)
Debt / FCF = -16.54 (negative FCF - burning cash) (Net Debt 1.10b / FCF TTM -66.6m)
Total Stockholder Equity = 967.5m (last 4 quarters mean from totalStockholderEquity)
RoA = 5.70% (Net Income 113.0m / Total Assets 2.18b)
RoE = 11.68% (Net Income TTM 113.0m / Total Stockholder Equity 967.5m)
RoCE = 6.32% (EBIT 137.6m / Capital Employed (Total Assets 2.18b - Current Liab 0.0))
RoIC = 6.40% (EBIT 137.6m / (Assets 2.18b - Curr.Liab 0.0 - Cash 29.4m))
WACC = 7.07% (E(1.44b)/V(2.57b) * Re(8.27%) + D(1.13b)/V(2.57b) * Rd(5.89%) * (1-Tc(0.06)))
Discount Rate = 8.27% (= CAPM, Blume Beta Adj.)
Shares (quarterly) Correlation: 82.22 | Cagr: 19.90%
[DCF] Fair Price = unknown (Cash Flow -66.6m)
EPS Correlation: -39.24 | EPS CAGR: -4.25% | SUE: -0.03 | # QB: 0
Revenue Correlation: 95.85 | Revenue CAGR: 22.17% | SUE: 0.65 | # QB: 0
EPS current Quarter (2026-06-30): EPS=0.54 | Chg30d=-6.29% | Revisions=-50% | Analysts=5
EPS next Quarter (2026-09-30): EPS=0.54 | Chg30d=-3.55% | Revisions=-43% | Analysts=5
EPS current Year (2027-03-31): EPS=2.18 | Chg30d=-3.79% | Revisions=-50% | GrowthEPS=-8.2% | GrowthRev=+9.4%
EPS next Year (2028-03-31): EPS=2.22 | Chg30d=N/A | Revisions=N/A | GrowthEPS=+1.9% | GrowthRev=+10.9%
[Analyst] Revisions Ratio: -50%