Capital Southwest CorporationCSWC
▼ NegativeCapitalrelevance
Earnings per share growth lags revenue growth, high debt load, and analyst recommendation to avoid.
Impact on stocks 1
Financials
Capital Southwest CorporationCapital Southwest shares have been treading water, returning just 1.4% over the past six months and holding steady at $24.02, trailing the S&P 500's 8.7% gain. Analysts point to earnings per share growing at an unimpressive 7.3% compounded annual rate over five years, well below the company's 27.8% annualized revenue growth, signaling declining per-share profitability. The company also carries a high debt load, with $1.13 billion in debt against $29.05 million in cash, resulting in a net-debt-to-EBITDA ratio of 7.4 times based on $148.5 million in trailing twelve-month EBITDA. With the stock trading at 11 times forward earnings, the report suggests the potential downside is too great and recommends looking at other opportunities.
Capital Southwest CorporationEarnings per share growth lags revenue growth, high debt load, and analyst recommendation to avoid.