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Upturn AI SWOT - About
Capital Southwest Corporation 7.75% Notes due 2028 (CSWCZ)
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Upturn Advisory Summary
06/07/2024: CSWCZ (1-star) has a low Upturn Star Rating. Not recommended to BUY.
Upturn Star Rating
Not Recommended Performance
These Stocks/ETFs, based on Upturn Advisory, consistently fall short of market performance, signaling caution before investing.
Number of Analysts
0 Analysts rated it
Very few follow this stock; limited insights, higher-risk early investing.
Analysis of Past Performance
Type Stock | Historic Profit 4.57% | Avg. Invested days 84 | Today’s Advisory Consider higher Upturn Star rating |
Upturn Star Rating | Upturn Advisory Performance  3.0 | Stock Returns Performance  1.0 |
| Profits based on simulation | Last Close 06/07/2024 |
Key Highlights
Company Size ETF | Market Capitalization 0 USD | Price to earnings Ratio - | 1Y Target Price - |
Price to earnings Ratio - | 1Y Target Price - | ||
Volume (30-day avg) - | Beta - | 52 Weeks Range 23.64 - 26.24 | Updated Date 06/9/2024 |
52 Weeks Range 23.64 - 26.24 | Updated Date 06/9/2024 | ||
Dividends yield (FY) 7.90% | Basic EPS (TTM) - |
Earnings Date
Report Date - | When - | Estimate - | Actual - |
Profitability
Profit Margin - | Operating Margin (TTM) - |
Management Effectiveness
Return on Assets (TTM) - | Return on Equity (TTM) - |
Valuation
Trailing PE - | Forward PE - | Enterprise Value - | Price to Sales(TTM) - |
Enterprise Value - | Price to Sales(TTM) - | ||
Enterprise Value to Revenue - | Enterprise Value to EBITDA - | Shares Outstanding - | Shares Floating - |
Shares Outstanding - | Shares Floating - | ||
Percent Insiders - | Percent Institutions - |
Upturn AI SWOT
Capital Southwest Corporation 7.75% Notes due 2028
Company Overview
History and Background
This analysis focuses on the 7.75% Notes due 2028 issued by Capital Southwest Corporation (CSWC). CSWC, founded in 1961, is a publicly traded business development company (BDC). It has evolved from a diversified holding company to a specialized lender focused on lower middle market companies.
Core Business Areas
- Direct Lending: Providing first lien, second lien, and unitranche debt to U.S. lower middle market companies.
- Equity Investments: Making minority equity investments, often alongside debt investments, to participate in the growth of portfolio companies.
Leadership and Structure
Bowen Diehl is the President and CEO. CSWC operates as a regulated investment company (RIC) under the 1940 Act.
Top Products and Market Share
Key Offerings
- First Lien Debt: Senior secured loans representing the primary claim on a borrower's assets. CSWC competes with other BDCs, private credit funds, and banks.
- Second Lien Debt: Subordinated secured loans with a secondary claim on assets. Competition includes other BDCs and mezzanine funds.
- Unitranche Debt: A hybrid loan combining features of both first and second lien debt. Competitors are typically private credit funds.
Market Dynamics
Industry Overview
The BDC industry is characterized by high yields and volatility. Demand for private credit is increasing as banks tighten lending standards.
Positioning
CSWC is a well-regarded BDC with a focus on lower middle market lending. It has a track record of consistent dividend payments and NAV growth.
Total Addressable Market (TAM)
The TAM for lower middle market lending is estimated to be in the hundreds of billions of dollars. CSWC has a small but growing share of this market.
Upturn SWOT Analysis
Strengths
- Experienced management team
- Strong underwriting standards
- Consistent dividend payments
- Access to capital markets
- Focus on growing lower middle market companies.
Weaknesses
- Reliance on debt financing
- Exposure to credit risk in portfolio companies
- Sensitivity to interest rate changes
- Concentration of investments in certain industries
- Small AUM relative to peers
Opportunities
- Growing demand for private credit
- Expansion into new geographies or industries
- Increased investment in existing portfolio companies
- Acquisition of smaller BDCs
- Partnerships with other financial institutions
Threats
- Economic recession
- Increased competition from other BDCs
- Rising interest rates
- Regulatory changes
- Deterioration in credit quality of portfolio companies
Competitors and Market Share
Key Competitors
- ARCC
- MAIN
- TICC
Competitive Landscape
CSWC differentiates itself through its focus on the lower middle market and its strong underwriting discipline. It competes with larger and smaller BDCs.
Growth Trajectory and Initiatives
Historical Growth: CSWC has grown its investment portfolio and net asset value over time through strategic investments and capital raising.
Future Projections: Analyst estimates should be consulted for projections of CSWC's future earnings and NAV growth.
Recent Initiatives: CSWC's recent initiatives may include new investments, portfolio company exits, and capital market transactions.
Summary
Capital Southwest Corporation's 7.75% Notes due 2028 are influenced by the underlying financial health and operational strength of CSWC. CSWC benefits from strong management and disciplined underwriting, but faces risks related to economic downturns and credit quality. Consistent dividend payments and NAV growth are positive indicators. They need to be wary of competition and financial ratios to remain strong.
Peer Comparison
Sources and Disclaimers
Data Sources:
- SEC Filings (10-K, 10-Q), Investor Presentations, Press Releases
- Bloomberg
- Company Website
Disclaimers:
This analysis is for informational purposes only and does not constitute financial advice. Investment decisions should be based on individual circumstances and consultation with a qualified financial advisor. Market share data is estimated and may not be precise.
AI Summarization is directionally correct and might not be accurate.
Summarized information shown could be a few years old and not current.
Fundamental Rating based on AI could be based on old data.
AI-generated summaries may have inaccuracies (hallucinations). Please verify the information before taking action.
About Capital Southwest Corporation 7.75% Notes due 2028
Exchange NASDAQ | Headquaters - | ||
IPO Launch date 2023-06-15 | CEO - | ||
Sector Financial Services | Industry Asset Management | Full time employees 26 | Website |
Full time employees 26 | Website | ||
Capital Southwest Corporation is a business development company specializing in credit and private equity and venture capital investments in middle market companies, mezzanine, later stage, mature, late venture, emerging growth, buyouts, recapitalizations and growth capital investments. It does not invest in startups, publicly traded companies, real estate developments, project finance opportunities, oil and gas exploration businesses, troubled companies, turnarounds, and companies in which significant senior management is departing. In lower middle market, the firm typically invests in growth financing, bolt-on acquisitions, new platform acquisitions, refinancing, dividend recapitalizations, sponsor-led buyouts, and management buyouts situations. The investment structures are Unitranche debt, subordinated debt, senior debt, first and second lien debt, and preferred and common equity. The firm makes equity co-investments alongside debt investments, up to 20% of total check and only makes non-control investments. It prefers to invest in Industrial manufacturing and services, value-added distribution, healthcare products and services, business services, specialty chemicals, food and beverage, tech-enabled services and SaaS models. The firm seeks to invest in energy services and products, industrial technologies, and specialty chemicals and products. Within energy services and products, the firm seeks to invest in each segment of the industry, including upstream, midstream and downstream, excluding exploration and production with a focus on differentiated products and services, equipment and tool rental, consumable products, and drilling and completion chemicals. Within industrial technologies, it seeks to invest in automation and process controls, handling and packaging equipment, industrial filtration and fluid handling, measurement, monitoring and testing, professional tools, and sensors and instrumentation. Within and specialty chemicals and products, the firm seeks to invest in businesses that develop and manuf
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