Latest news with #CapitalSouthwest
Yahoo
08-08-2025
- Business
- Yahoo
Capital Southwest Corp (CSWC) Q1 2026 Earnings Call Highlights: Strong Investment Income and ...
Pretax Net Investment Income: $32.7 million, or $0.61 per share. Total Investment Income: Increased to $55.9 million from $52.4 million in the prior quarter. Weighted Average Yield on Debt Investments: 11.8%. Non-Accrual Rate: Decreased from 1.7% to 0.8% of the investment portfolio at fair value. Regular Dividends Declared: $0.58 per share, payable monthly in July, August, and September 2025. Supplemental Dividend Declared: $0.06 per share, bringing total dividends for the quarter to $0.64 per share. Undistributed Taxable Income Balance: Increased to $1 per share from $0.79 per share. Gross Equity Proceeds Raised: $42 million through the equity ATM program. New Commitments: $115 million in total new commitments to three new portfolio companies and 12 existing portfolio companies. On-Balance Sheet Credit Portfolio: Ended the quarter at $1.6 billion, a year-over-year growth of 21%. Net Asset Value (NAV) per Share: $16.59, a decrease from $16.70 in the prior quarter. Regulatory Leverage: Debt-to-equity ratio of 0.82 to 1, down from 0.89 to 1 in the prior quarter. Cash and Undrawn Leverage Commitments: Approximately $444 million. Warning! GuruFocus has detected 7 Warning Signs with CSWC. Release Date: August 07, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points Capital Southwest Corp (NASDAQ:CSWC) reduced its investment portfolio's weighted average debt to EBITDA from 3.5 times to 3.4 times, indicating improved financial health. The company transitioned its regular dividend payment frequency from quarterly to monthly, which is seen as a shareholder-friendly initiative. CSWC received final approval for its second SBIC license, allowing access to up to $175 million in additional SBA debentures, enhancing its financial flexibility. The company raised $42 million in gross equity proceeds through its equity ATM program, strengthening its capital position. CSWC's portfolio remains healthy, with approximately 92% of the portfolio at fair value rated in the top two categories, indicating strong credit quality. Negative Points The competitive landscape remains challenging, with banks and non-bank lenders aggressively deploying capital, leading to spread compression. The company's NAV per share decreased from $16.70 to $16.59, primarily due to the issuance of restricted stock compensation. There is a risk of macroeconomic factors impacting the company's ability to maintain its regular dividend if interest rates drop significantly. The lower middle market remains competitive, with tight loan pricing for high-quality opportunities, which could impact future profitability. CSWC's regulatory leverage ended the quarter at a debt-to-equity ratio of 0.82 to 1, which is lower than some peers, potentially limiting growth opportunities. Q & A Highlights Q: Can you discuss the current competitive landscape and how it might evolve in the coming quarters? A: Joshua Weinstein, Chief Investment Officer, noted that there is a supply-demand dynamic at play. Private equity sponsors are cautious about consumer discretionary businesses and international supply chains, leading to a scarcity of quality assets. Banks and non-bank lenders remain aggressive, causing spread compression. Despite this, Capital Southwest has maintained prudent structuring and continues to find opportunities, with current deals offering spreads around 7%. Q: What is driving your optimism for the M&A market in the second half of the year? A: Michael Sarner, CEO, explained that some deals from the June quarter have carried over into the September quarter. The company has already closed $110 million in originations and expects another $40 million to close soon. The lower middle market remains active, and the company's strong relationships with private equity firms are yielding a robust pipeline of quality deals. Q: How do you view the potential for prepayment or repayment activity in the coming quarters? A: Michael Sarner mentioned that the company experienced over $80 million in repayments this quarter. While a few larger holds are expected to go to market in the December quarter, there is no significant repayment activity anticipated for the September quarter. Q: Can you provide an update on your operating leverage and expectations for the future? A: Michael Sarner stated that operating leverage is expected to decrease from 1.7% to a run rate of 1.4% to 1.5% by the end of the fiscal year. The internally managed structure allows for cost efficiencies while still investing in staff and infrastructure, which is expected to be a competitive advantage as interest rates decline. Q: How do you plan to manage balance sheet leverage and equity issuance moving forward? A: Michael Sarner indicated that the company aims to maintain leverage in the 0.85 to 0.9 range, with consistent equity issuance through the ATM program. The company is comfortable with its current leverage levels and focuses on maintaining a conservative balance sheet to support its business model and market credibility. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
15-07-2025
- Business
- Yahoo
Capital Southwest Announces Preliminary Estimate of First Quarter 2026 Operating Results and Earnings Release and Conference Call Schedule
DALLAS, July 15, 2025 (GLOBE NEWSWIRE) -- Capital Southwest Corporation ('Capital Southwest') (Nasdaq: CSWC), an internally managed business development company focused on providing flexible financing solutions to support the acquisition and growth of middle market businesses, is pleased to announce its preliminary operating results for the first quarter of its 2026 fiscal year (quarter ended June 30, 2025) and its first quarter 2026 earnings release and conference call schedule. Capital Southwest's preliminary estimate of its first quarter 2026 pre-tax net investment income is in the range of $0.60 to $0.61 per share. The preliminary estimate of Capital Southwest's net investment income for the same period is in the range of $0.58 to $0.59 per share. Additionally, Capital Southwest's preliminary estimate of its net asset value per share as of June 30, 2025 is in the range of $16.55 to $16.65. Capital Southwest's preliminary estimate of its non-accruals as a percentage of the total investment portfolio at cost and fair value is 2.6% and 0.8%, respectively. Capital Southwest will release its finalized first quarter 2026 results on Wednesday, August 6, 2025 after the market closes. In conjunction with the release, Capital Southwest has scheduled a live webcast on Thursday, August 7, 2025 at 1:00 p.m., Eastern Time. Investors may participate in the webcast.(1) By Webcast: Connect to the webcast using the Investor Relations section of Capital Southwest's website at or by going to the following website: Please log in at least 10 minutes in advance to register and download any necessary software. A replay of the webcast will be available on Capital Southwest's website shortly after the call. Live Call Participation:Participants who want to join the call and ask a question must register using the following URL: Once registered, participants will receive the dial-in numbers and a unique PIN number. When participants dial in, they will input their PIN and be placed into the call. Registration is still possible even after the event has started. About Capital Southwest Capital Southwest Corporation (Nasdaq: CSWC) is a Dallas, Texas-based, internally managed business development company with approximately $1.8 billion in investments at fair value as of March 31, 2025. Capital Southwest is a middle market lending firm focused on supporting the acquisition and growth of middle market businesses with $5 million to $50 million investments across the capital structure, including first lien, second lien and non-control equity co-investments. As a public company with a permanent capital base, Capital Southwest has the flexibility to be creative in its financing solutions and to invest to support the growth of its portfolio companies over long periods of time. Forward-Looking StatementsThis press release contains forward-looking statements and provides historical information with respect to the business and investments of Capital Southwest, including, but not limited to, the preliminary estimates of its first quarter 2026 fiscal year financial information and results, which are based on current information available to Capital Southwest as of the date hereof. The preliminary estimates of the first quarter 2026 fiscal year financial information and estimated results furnished above are based on Capital Southwest management's preliminary determinations and current expectations, and such information is inherently uncertain. The preliminary estimates may not align with Capital Southwest's actual results of operations for the period, which will not be known until Capital Southwest completes its customary quarter-end closing and review procedures, including the determination of the fair value of Capital Southwest's portfolio investments. As a result, actual results could differ materially from the current preliminary estimates based on adjustments made during Capital Southwest's quarter-end closing and review procedures, and Capital Southwest's reported information in its Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 may differ from this information, and any such differences may be material. In addition, the information furnished above does not include all of the information regarding Capital Southwest's financial condition and results of operations for the quarter ended June 30, 2025 that may be important to readers. As a result, readers are cautioned not to place undue reliance on the information furnished in this press release and should view this information in the context of Capital Southwest's full first quarter 2026 results when such results are disclosed by Capital Southwest in its Quarterly Report on Form 10-Q for the quarter ended June 30, 2025. The information furnished in this press release is based on current expectations of Capital Southwest's management that involve substantial risks and uncertainties that could cause actual results to differ materially from the results expressed in, or implied by, such information. Forward-looking statements are statements that are not historical statements and can often be identified by words such as "will," "believe," "expect" and similar expressions and variations or negatives of these words. These statements are based on management's current expectations, assumptions and beliefs. They are not guarantees of future results and are subject to numerous risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statement. These risks include risks related to: changes in the markets in which Capital Southwest invests; changes in the financial, capital, and lending markets; changes in the interest rate environment and its impact on Capital Southwest's business and its portfolio companies; regulatory changes; tax treatment; Capital Southwest's ability to operate each of its wholly owned subsidiaries, Capital Southwest SBIC I, LP and Capital Southwest SBIC II, LP, as a small business investment company; the uncertainty associated with the imposition of tariffs and trade barriers and changes in trade policy and its impact on our portfolio companies and our financial condition; an economic downturn or recession and its impact on the ability of Capital Southwest's portfolio companies to operate and the investment opportunities available to it; the impact of supply chain constraints on Capital Southwest's portfolio companies; and the elevated levels of inflation and its impact on Capital Southwest's portfolio companies and the industries in which it invests. Readers should not place undue reliance on any forward-looking statements and are encouraged to review Capital Southwest's Annual Report on Form 10-K for the year ended March 31, 2025 and any subsequent filings, including the "Risk Factors" sections therein, with the Securities and Exchange Commission for a more complete discussion of the risks and other factors that could affect any forward-looking statements. Except as required by the federal securities laws, Capital Southwest does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changing circumstances or any other reason after the date of this press release. Investor Relations Contact:Michael S. Sarner, President and Chief Executive Officer214-884-3829 (1) No information contained on our website or disclosed on the August 7, 2025 conference call, including the webcast, is incorporated by reference into this press release or any of our filings with the SEC, and you should not consider that information to be part of this press release or any other such in retrieving data Sign in to access your portfolio Error in retrieving data
Yahoo
11-06-2025
- Business
- Yahoo
Capital Southwest Announces Transition to Monthly Regular Dividends and Declares Total Dividends of $0.64 per share for the Quarter Ending September 30, 2025
DALLAS, June 11, 2025 (GLOBE NEWSWIRE) -- Capital Southwest Corporation ('Capital Southwest' or the 'Company') (Nasdaq: CSWC), an internally managed business development company focused on providing flexible financing solutions to support the acquisition and growth of middle market businesses, is pleased to announce a change to its regular dividend payment frequency from quarterly to monthly beginning in July 2025. In addition, the Company is pleased to announce that its Board of Directors has declared monthly regular dividends of $0.1934 per share for each of July, August, and September 2025 and a quarterly supplemental dividend of $0.06 per share payable in September 2025, each of which is detailed in the table below. Michael Sarner, President and Chief Executive Officer, stated, 'We believe that transitioning to a monthly regular dividend is a shareholder friendly initiative which will benefit all shareholders of Capital Southwest. We are pleased with the strong earnings generation and credit quality of our portfolio, which allows us to continue to distribute significant recurring dividends to our shareholders.' The Company's regular monthly dividends for the quarter ending September 30, 2025 will be payable as follows: Declared Ex-Dividend Date Record Date Payment Date Amount Per Share 6/11/2025 7/15/2025 7/15/2025 7/31/2025 $0.1934 6/11/2025 8/15/2025 8/15/2025 8/29/2025 $0.1934 6/11/2025 9/15/2025 9/15/2025 9/30/2025 $0.1934 The Company's supplemental dividend for the quarter ending September 30, 2025 will be payable as follows: Declared Ex-Dividend Date Record Date Payment Date Amount Per Share 6/11/2025 9/15/2025 9/15/2025 9/30/2025 $0.06Total Regular Dividends per Share for Quarter Ending September 30, 2025: $0.58 Total Supplemental Dividend per Share for Quarter Ending September 30, 2025: $0.06 Total Dividends per Share for Quarter Ending September 30, 2025: $0.64When declaring dividends, the Board of Directors reviews estimates of taxable income available for distribution, which may differ from net investment income under generally accepted accounting principles. The final determination of taxable income for each year, as well as the tax attributes for dividends in such year, will be made after the close of the tax year. Capital Southwest maintains a dividend reinvestment plan ("DRIP") that provides for the reinvestment of dividends on behalf of its registered stockholders who hold their shares with Capital Southwest's transfer agent and registrar, Equiniti Trust Company. Under the DRIP, if the Company declares a dividend, registered stockholders who have opted in to the DRIP by the dividend record date will have their dividend automatically reinvested into additional shares of Capital Southwest's common stock. About Capital Southwest Capital Southwest Corporation (Nasdaq: CSWC) is a Dallas, Texas-based, internally managed business development company with approximately $1.8 billion in investments at fair value as of March 31, 2025. Capital Southwest is a middle market lending firm focused on supporting the acquisition and growth of middle market businesses with $5 million to $50 million investments across the capital structure, including first lien, second lien and non-control equity co-investments. As a public company with a permanent capital base, Capital Southwest has the flexibility to be creative in its financing solutions and to invest to support the growth of its portfolio companies over long periods of time. Forward-Looking Statements This press release contains historical information and certain forward-looking statements with respect to the business and investments of the Company, including, but not limited to, the timing, form and amount of any distributions or supplemental dividends in the future. Forward-looking statements are statements that are not historical statements and can often be identified by words such as "will," "believe," "expect" and similar expressions and variations or negatives of these words. These statements are based on management's current expectations, assumptions and beliefs. They are not guarantees of future results and are subject to numerous risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statement. These risks include risks related to: changes in the markets in which the Company invests; changes in the financial, capital, and lending markets; changes in the interest rate environment and its impact on the Company's business and its portfolio companies; regulatory changes; tax treatment; the uncertainty associated with the imposition of tariffs and trade barriers and changes in trade policy and its impact on the Company's portfolio companies and the Company's financial condition; an economic downturn and its impact on the ability of the Company's portfolio companies to operate and the investment opportunities available to the Company; the impact of supply chain constraints on the Company's portfolio companies; and the elevated levels of inflation and its impact on the Company's portfolio companies and the industries in which it invests. Readers should not place undue reliance on any forward-looking statements and are encouraged to review Capital Southwest's Annual Report on Form 10-K for the year ended March 31, 2025 and any subsequent filings with the SEC, including the "Risk Factors" sections therein, for a more complete discussion of the risks and other factors that could affect any forward-looking statements. Except as required by the federal securities laws, Capital Southwest does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changing circumstances or any other reason after the date of this press release. Investor Relations Contact: Michael S. Sarner, President and Chief Executive Officer214-884-3829Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
17-05-2025
- Business
- Yahoo
Capital Southwest Corporation Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now
Investors in Capital Southwest Corporation (NASDAQ:CSWC) had a good week, as its shares rose 6.8% to close at US$21.37 following the release of its yearly results. Revenues were in line with forecasts, at US$204m, although statutory earnings per share came in 15% below what the analysts expected, at US$1.47 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Capital Southwest after the latest results. Our free stock report includes 3 warning signs investors should be aware of before investing in Capital Southwest. Read for free now. Taking into account the latest results, the current consensus from Capital Southwest's five analysts is for revenues of US$226.8m in 2026. This would reflect a solid 11% increase on its revenue over the past 12 months. Per-share earnings are expected to jump 61% to US$2.25. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$226.4m and earnings per share (EPS) of US$2.31 in 2026. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts. See our latest analysis for Capital Southwest The consensus price target held steady at US$22.92, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Capital Southwest at US$25.00 per share, while the most bearish prices it at US$20.50. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth. Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Capital Southwest's revenue growth is expected to slow, with the forecast 11% annualised growth rate until the end of 2026 being well below the historical 28% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.4% annually. So it's pretty clear that, while Capital Southwest's revenue growth is expected to slow, it's still expected to grow faster than the industry itself. The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Capital Southwest. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at US$22.92, with the latest estimates not enough to have an impact on their price targets. Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Capital Southwest analysts - going out to 2027, and you can see them free on our platform here. Don't forget that there may still be risks. For instance, we've identified 3 warning signs for Capital Southwest (2 are significant) you should be aware of. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Yahoo
17-05-2025
- Business
- Yahoo
Capital Southwest Corporation Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now
Investors in Capital Southwest Corporation (NASDAQ:CSWC) had a good week, as its shares rose 6.8% to close at US$21.37 following the release of its yearly results. Revenues were in line with forecasts, at US$204m, although statutory earnings per share came in 15% below what the analysts expected, at US$1.47 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Capital Southwest after the latest results. Our free stock report includes 3 warning signs investors should be aware of before investing in Capital Southwest. Read for free now. Taking into account the latest results, the current consensus from Capital Southwest's five analysts is for revenues of US$226.8m in 2026. This would reflect a solid 11% increase on its revenue over the past 12 months. Per-share earnings are expected to jump 61% to US$2.25. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$226.4m and earnings per share (EPS) of US$2.31 in 2026. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts. See our latest analysis for Capital Southwest The consensus price target held steady at US$22.92, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Capital Southwest at US$25.00 per share, while the most bearish prices it at US$20.50. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth. Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Capital Southwest's revenue growth is expected to slow, with the forecast 11% annualised growth rate until the end of 2026 being well below the historical 28% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.4% annually. So it's pretty clear that, while Capital Southwest's revenue growth is expected to slow, it's still expected to grow faster than the industry itself. The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Capital Southwest. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at US$22.92, with the latest estimates not enough to have an impact on their price targets. Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Capital Southwest analysts - going out to 2027, and you can see them free on our platform here. Don't forget that there may still be risks. For instance, we've identified 3 warning signs for Capital Southwest (2 are significant) you should be aware of. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
