CAPITAL SOUTHWEST CORP (CSWC) Stock Fundamental Analysis
NASDAQ:CSWC - Nasdaq - US1405011073 - Common Stock - Currency: USD
Overall CSWC gets a fundamental rating of 5 out of 10. We evaluated CSWC against 225 industry peers in the Capital Markets industry. CSWC has only an average score on both its financial health and profitability. CSWC has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year CSWC was profitable.
In the past year CSWC has reported a negative cash flow from operations.
CSWC had positive earnings in 4 of the past 5 years.
CSWC had a negative operating cash flow in each of the past 5 years.
1.2 Ratios
With a Return On Assets value of 3.71%, CSWC perfoms like the industry average, outperforming 56.62% of the companies in the same industry.
Looking at the Return On Equity, with a value of 8.00%, CSWC is in line with its industry, outperforming 43.38% of the companies in the same industry.
The Return On Invested Capital of CSWC (5.40%) is better than 70.32% of its industry peers.
CSWC had an Average Return On Invested Capital over the past 3 years of 4.51%. This is below the industry average of 6.76%.
The 3 year average ROIC (4.51%) for CSWC is below the current ROIC(5.40%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.71% | ||
| ROE | 8% | ||
| ROIC | 5.4% |
ROA(3y)4.13%
ROA(5y)3.09%
ROE(3y)8.94%
ROE(5y)6.74%
ROIC(3y)4.51%
ROIC(5y)4.26%
1.3 Margins
CSWC has a better Profit Margin (33.49%) than 74.43% of its industry peers.
In the last couple of years the Profit Margin of CSWC has declined.
CSWC's Operating Margin of 61.35% is amongst the best of the industry. CSWC outperforms 94.98% of its industry peers.
In the last couple of years the Operating Margin of CSWC has grown nicely.
The Gross Margin of CSWC (74.20%) is better than 79.45% of its industry peers.
In the last couple of years the Gross Margin of CSWC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 61.35% | ||
| PM (TTM) | 33.49% | ||
| GM | 74.2% |
OM growth 3Y7.54%
OM growth 5Y5.44%
PM growth 3Y-14.44%
PM growth 5Y-6%
GM growth 3Y1.01%
GM growth 5Y-0.18%
2. Health
2.1 Basic Checks
CSWC has more shares outstanding than it did 1 year ago.
The number of shares outstanding for CSWC has been increased compared to 5 years ago.
CSWC has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.03, we must say that CSWC is in the distress zone and has some risk of bankruptcy.
CSWC's Altman-Z score of 1.03 is in line compared to the rest of the industry. CSWC outperforms 52.05% of its industry peers.
A Debt/Equity ratio of 1.11 is on the high side and indicates that CSWC has dependencies on debt financing.
CSWC has a Debt to Equity ratio (1.11) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.11 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 1.03 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
CSWC has a Current Ratio of 5.48. This indicates that CSWC is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 5.48, CSWC belongs to the top of the industry, outperforming 86.76% of the companies in the same industry.
A Quick Ratio of 5.48 indicates that CSWC has no problem at all paying its short term obligations.
The Quick ratio of CSWC (5.48) is better than 86.76% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 5.48 | ||
| Quick Ratio | 5.48 |
3. Growth
3.1 Past
The earnings per share for CSWC have decreased by -4.09% in the last year.
CSWC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 13.71% yearly.
The Revenue has grown by 17.51% in the past year. This is quite good.
The Revenue has been growing by 27.97% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)-4.09%
EPS 3Y17.37%
EPS 5Y13.71%
EPS Q2Q%-10%
Revenue 1Y (TTM)17.51%
Revenue growth 3Y37.78%
Revenue growth 5Y27.97%
Sales Q2Q%7.02%
3.2 Future
CSWC is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -2.61% yearly.
The Revenue is expected to grow by 13.48% on average over the next years. This is quite good.
EPS Next Y-4.15%
EPS Next 2Y-4.02%
EPS Next 3Y-2.61%
EPS Next 5YN/A
Revenue Next Year15.42%
Revenue Next 2Y12.78%
Revenue Next 3Y13.48%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
CSWC is valuated reasonably with a Price/Earnings ratio of 9.02.
Compared to the rest of the industry, the Price/Earnings ratio of CSWC indicates a somewhat cheap valuation: CSWC is cheaper than 77.63% of the companies listed in the same industry.
CSWC is valuated cheaply when we compare the Price/Earnings ratio to 29.63, which is the current average of the S&P500 Index.
CSWC is valuated reasonably with a Price/Forward Earnings ratio of 9.35.
Based on the Price/Forward Earnings ratio, CSWC is valued a bit cheaper than the industry average as 73.52% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 22.68. CSWC is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.02 | ||
| Fwd PE | 9.35 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CSWC is valued a bit cheaper than 78.54% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 16.21 |
4.3 Compensation for Growth
A cheap valuation may be justified as CSWC's earnings are expected to decrease with -2.61% in the coming years.
PEG (NY)N/A
PEG (5Y)0.66
EPS Next 2Y-4.02%
EPS Next 3Y-2.61%
5. Dividend
5.1 Amount
CSWC has a Yearly Dividend Yield of 9.78%, which is a nice return.
CSWC's Dividend Yield is a higher than the industry average which is at 9.98.
CSWC's Dividend Yield is rather good when compared to the S&P500 average which is at 2.27.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 9.78% |
5.2 History
The dividend of CSWC has a limited annual growth rate of 0.11%.
CSWC has been paying a dividend for at least 10 years, so it has a reliable track record.
The dividend of CSWC decreased in the last 3 years.
Dividend Growth(5Y)0.11%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
CSWC pays out 180.48% of its income as dividend. This is not a sustainable payout ratio.
The Dividend Rate of CSWC has been growing, while earnings will be declining. This means the dividend growth is most likely not sustainable.
DP180.48%
EPS Next 2Y-4.02%
EPS Next 3Y-2.61%
23.26
-0.35 (-1.48%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners31.5%
Inst Owner Change-74.71%
Ins Owners4.14%
Ins Owner Change0.04%
Market Cap1.18B
Analysts77.14
Price Target24.48 (5.25%)
Short Float %2.34%
Short Ratio1.95
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 9.78% |
Yearly Dividend2.54
Dividend Growth(5Y)0.11%
DP180.48%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-0.61%
Min EPS beat(2)-0.63%
Max EPS beat(2)-0.58%
EPS beat(4)0
Avg EPS beat(4)-1.75%
Min EPS beat(4)-4.35%
Max EPS beat(4)-0.58%
EPS beat(8)3
Avg EPS beat(8)0.42%
EPS beat(12)6
Avg EPS beat(12)0.95%
EPS beat(16)7
Avg EPS beat(16)-0.15%
Revenue beat(2)1
Avg Revenue beat(2)-0.79%
Min Revenue beat(2)-3.16%
Max Revenue beat(2)1.58%
Revenue beat(4)2
Avg Revenue beat(4)0.16%
Min Revenue beat(4)-3.16%
Max Revenue beat(4)2.48%
Revenue beat(8)5
Avg Revenue beat(8)-0.28%
Revenue beat(12)7
Avg Revenue beat(12)-0.01%
Revenue beat(16)9
Avg Revenue beat(16)0.13%
PT rev (1m)-4.55%
PT rev (3m)-0.69%
EPS NQ rev (1m)-4.95%
EPS NQ rev (3m)-7.28%
EPS NY rev (1m)1.05%
EPS NY rev (3m)1.12%
Revenue NQ rev (1m)-0.67%
Revenue NQ rev (3m)5.7%
Revenue NY rev (1m)1.13%
Revenue NY rev (3m)0.51%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.02 | ||
| Fwd PE | 9.35 | ||
| P/S | 5.93 | ||
| P/FCF | N/A | ||
| P/OCF | N/A | ||
| P/B | 1.42 | ||
| P/tB | 1.42 | ||
| EV/EBITDA | 16.21 |
EPS(TTM)2.58
EY11.09%
EPS(NY)2.49
Fwd EY10.69%
FCF(TTM)-5.18
FCFYN/A
OCF(TTM)-5.15
OCFYN/A
SpS3.92
BVpS16.42
TBVpS16.42
PEG (NY)N/A
PEG (5Y)0.66
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.71% | ||
| ROE | 8% | ||
| ROCE | 6.83% | ||
| ROIC | 5.4% | ||
| ROICexc | 5.51% | ||
| ROICexgc | 5.65% | ||
| OM | 61.35% | ||
| PM (TTM) | 33.49% | ||
| GM | 74.2% | ||
| FCFM | N/A |
ROA(3y)4.13%
ROA(5y)3.09%
ROE(3y)8.94%
ROE(5y)6.74%
ROIC(3y)4.51%
ROIC(5y)4.26%
ROICexc(3y)4.59%
ROICexc(5y)4.36%
ROICexgc(3y)4.69%
ROICexgc(5y)4.47%
ROCE(3y)5.7%
ROCE(5y)5.4%
ROICexcg growth 3Y14.66%
ROICexcg growth 5Y9.62%
ROICexc growth 3Y14.47%
ROICexc growth 5Y9.65%
OM growth 3Y7.54%
OM growth 5Y5.44%
PM growth 3Y-14.44%
PM growth 5Y-6%
GM growth 3Y1.01%
GM growth 5Y-0.18%
F-Score1
Asset Turnover0.11
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.11 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 7.24 | ||
| Cap/Depr | 23.84% | ||
| Cap/Sales | 0.64% | ||
| Interest Coverage | 2.75 | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 5.48 | ||
| Quick Ratio | 5.48 | ||
| Altman-Z | 1.03 |
F-Score1
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)33.98%
Cap/Depr(5y)N/A
Cap/Sales(3y)0.9%
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-4.09%
EPS 3Y17.37%
EPS 5Y13.71%
EPS Q2Q%-10%
EPS Next Y-4.15%
EPS Next 2Y-4.02%
EPS Next 3Y-2.61%
EPS Next 5YN/A
Revenue 1Y (TTM)17.51%
Revenue growth 3Y37.78%
Revenue growth 5Y27.97%
Sales Q2Q%7.02%
Revenue Next Year15.42%
Revenue Next 2Y12.78%
Revenue Next 3Y13.48%
Revenue Next 5YN/A
EBIT growth 1Y17.15%
EBIT growth 3Y48.18%
EBIT growth 5Y34.94%
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-9.4%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-9.87%
OCF growth 3YN/A
OCF growth 5YN/A