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Summary

  • In Q4 FY23, Capital Southwest earned total investment income of US$ 37.2 million.
  • CSWC received an upgraded ‘Buy’ rating from B Riley Securities post the release of its Q4 FY23 results.
  • Capital Southwest paid a regular dividend of US$ 0.53 per share, while a supplemental dividend of US$ 0.05 per share in Q4 FY23.

Capital Southwest, a financing solutions provider, released its results for Q4 FY23 ended March 31, 2023. The financial results were released on May 24, 2023, highlighting the company’s total investment portfolio of US$ 1.2 billion.

Analysts retained their ‘Buy’ ratings on CSWC post the release of the company’s results for Q4 FY23. EODHD/Others data shows that the consensus price target on the stock is US$ 21.56, an upside potential of 17.81% on the previous close of the stock.

CSWC price chart; Image Source: EODHD/Others

CSWC closed at US$ 18.3 on May 31, 2023. The stock hit its 52-week high of US$ 22.7 exactly a year back on May 31, 2023. As per data available on EODHD/Others, two analysts gave ‘Strong Buy’ rating, and three analysts gave 'Buy’ rating. Meanwhile, three analysts gave ‘Hold’ rating on CSWC, and none gave it ‘Sell’ or ‘Strong Sell’ ratings.

The mean recommendation rating on the stock is 2.1 on a scale of one to five. Here, one represents a ‘Strong Buy’ rating, while five represents a ‘Strong Sell’ rating.

The price target on CSWC

B Riley upgraded CSWC to ‘Buy’ after the company earnings its results for Q4 FY23. The broker’s price target on the stock is US$ 21.50, marking an upside potential of 17.49% on CSWC’s previous close.

JMP Securities maintained ‘Market Outperform’ rating on the stock, with a price target of US$ 22. This price target is 20.22% higher than CSWC’s closing price on May 31, 2023. Another broker that retained its ‘Buy’ rating on the stock is Ladenburg Thalmann & Co Inc.

Alternatively, Oppenheimer & Co. gave ‘Perform’ rating on the stock, while Hovde Group gave it ‘Market Perform’ rating. Notably, post the Q4 FY23 release, only B Riley Securities upgraded its rating on the stock, while others maintained their previous ratings.

Image source: ©2023 Kalkine®; Data source: CSWC EODHD/Others

CSWC’s Financial Results

For Q4 FY23, CSWC’s total investment income was US$ 37.2 million, as against US$ 32.8 million in the previous quarter. CSWC reported that the increase in investment income stemmed from a rise in average debt investments outstanding, alongside an increase in weighted average yield on investments.

Capital Southwest reported a pre-tax net investment income of US$ 22.8 million, or US$ 0.65 per weighted average share outstanding. CSWC reported a credit portfolio of US$ 1 billion and an equity portfolio of US$ 117.5 million for the quarter.

The regular dividend paid by Capital Southwest in Q4 FY23 was US$ 0.53 per share, while the supplemental dividend was US$ 0.05 per share. Meanwhile, the company’s cash and cash equivalents for the quarter were US$ 21.6 million.