CSWC Stock Recent News

Call Scheduled for 11:00 a.m. Eastern Time on Tuesday, October 31, 2023 Call Scheduled for 11:00 a.m. Eastern Time on Tuesday, October 31, 2023

Capital Southwest has good dividend coverage and recently raised its dividend. Despite payments of supplemental dividends and regular dividend growth, the risk/reward ratio is no longer attractive. CSWC trades at a premium valuation, and passive income investors can buy better-priced BDCs with comparable yields and higher margins of safety.

This is a series of articles discussing retirement portfolios using BDCs currently yielding around 12% and their safer notes, baby bonds/preferred shares with yield-to-maturities ranging from 6% to 9%. CSWC is an internally managed BDC with a dividend yield of 10.7% and investment-grade notes with yields of almost 8%. We discuss the interest expense and asset coverage ratios for CSWC.

Capital Southwest stock has outperformed the S&P 500 and its peers over the past year, brushing aside Wall Street's unfounded recession fears. CSWC has astutely leveraged its accretive ATM equity offerings to improve its balance sheet and reduced leverage. Despite its remarkable performance, CSWC remains attractively valued, as the broad BDC industry remains discounted.

Rising interest rates benefit the BDC industry, as most BDCs have a majority of floating rate investments. Capital Southwest has seen a significant increase in cash interest investment income. CSWC has a strong dividend growth rate and has outperformed the BDC industry and financial sector.

Every earnings season is like a new season of a TV show. You get all the information you're going to get for that season. This is the perfect time to spot-check your portfolio and make sure your income is as strong as you expect it to be. Don't let the tidbit of news that's blown up out of proportion between quarterly updates derail your mental thinking.

During its recent earnings, Capital Southwest exceeded analysts' expectations, beating on NII and total investment income. CSWC elected to raise the dividend for the second time this year by 3.7% and declared a supplemental of $0.06 payable in September. CSWC has beaten both peers Main Street Capital and Ares Capital in price and total return over the last 5 and 10 years.

Capital Southwest (NASDAQ:CSWC ) Q1 2024 Earnings Conference Call August 8, 2023 11:00 AM ET Company Participants Chris Rehberger - Vice President, Finance Bowen Diehl - Chief Executive Officer Michael Sarner - Chief Financial Officer Conference Call Participants Kyle Joseph - Jefferies Bryce Rowe - B. Riley Operator Thank you for joining today's Capital Southwest First Quarter Fiscal Year 2024 Earnings Call.

Capital Southwest just hiked its base dividend by 3.7% for a double-digit 10.3% annualized forward yield. The BDC saw its NAV per share for its recent fiscal 2023 second quarter come in at $16.38, roughly flat versus the first quarter. The commons are currently trading at a large 30% premium to NAV.

Capital Southwest (CSWC) came out with quarterly earnings of $0.65 per share, beating the Zacks Consensus Estimate of $0.63 per share. This compares to earnings of $0.49 per share a year ago.