Stock fact sheet · data as of
Capital Southwest Corporation (CSWC): fair value, margin of safety and Wheel Score
Ticker symbol CSWC · Financial Services · Asset Management · United States · Blend Income
Is CSWC undervalued?
Capital Southwest Corporation (CSWC) closed at 23.79 on 5 Nov 2026. The GLS average fair value - the simple average of the 7 valuation models that produced a positive number - is 33.54, so the price sits 29% below it. 5 of the 7 models value the shares above the current price. A margin of safety between 10% and 30% is where most of the Sunday Scan candidates come from.
The 7 models disagree widely: Lynch gives 6.70 while DCF gives 90.85. A spread that wide means the average is sensitive to which methods you trust; the model table below shows where each one lands, and the Quote page lets you switch any of them off.
Ranked against every other company we cover, neither cheapness nor growth clearly wins for CSWC, so the nightly engine files it under Blend (value score 57, growth score 72, out of 100). It also carries the Income tag (Income = a dividend yield of 4% or more).
Nine valuation models for CSWC
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 90.85 | +282% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 25.59 | +8% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 27.01 | +14% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 6.70 | -72% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 28.36 | +19% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | - | - | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10%; no value tonight |
| Payback Time | - | - | Eight years of compounded free cash flow: the price at which the business pays for itself; no value tonight |
| DDM | 37.68 | +58% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | 18.60 | -22% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | -16.57 | -170% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 24.00 | +1% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
Financial health is weak: CSWC passes 4 of the nine Piotroski tests. Our scans drop the stock at the health filter; a low score is often the reason a stock looks cheap on the valuation models. The GLS Moat score is 5.5 out of 10: a record that is solid on some of the four parts the score weighs (returns on capital, pricing power, lasting growth, balance sheet) and weaker on others.
Returns on capital are moderate - ROIC 5.3%, ROE 11.2%, ROA 5.2% - with debt at 1.12 times equity and negative free cash flow.
The dividend yield is high at 10.76% (payout ratio 147%) - a payout above 100% of earnings, which is not covered by profits. A yield this size is often the market's way of pricing a risk to the payout, so the health score and cash flow matter more than usual.
Institutional ownership scores 4/10, insider activity 7/10 and Congressional trading 5/10 on the GLS smart-money scales; the last recorded insider buy was on 1 Oct 2026.
| Piotroski F-score | 4 / 9 | ROIC | 5.3% |
|---|---|---|---|
| GLS Moat | 5.5 / 10 | ROE | 11.2% |
| Debt / equity | 1.12 | ROA | 5.2% |
| Free-cash-flow yield | -18.9% | Payout ratio | 147% |
| Institutions | 4 / 10 | Insiders · Congress | 7 · 5 / 10 |
Wheel Score 49: Weak
CSWC scores 49 out of 100 on the Wheel Score, in the Weak band (under 50): it fails filter 4, financially healthy - Piotroski 4/9 (under 6), and the parts are thin too - value strong, premium strong, moat fair, health fair, red flags strong, option trading weak, stability fair. The score is not a judgement on the company; it says the price, quality and premium do not line up for selling puts on it today.
Implied volatility is 36% on the near-the-money contracts 20-60 days out - inside the 35-60% sweet spot the Wheel Score rewards most: enough premium to be worth selling, not so much that the risk is unpaid. Chain open interest is 6,909 contracts across all expiries - enough for the wheel at normal size.
Volume runs at 499k shares a day on a market cap of $1.6B, with a beta of 0.71 - a low beta, so day-to-day moves are smaller than the market's; the Stability part of the Wheel Score rates that fair.
| Filter | Wheel Trade Filter | Result | Detail |
|---|---|---|---|
| 1 | Options that actually trade | Passes | Listed options with 1,000+ contracts of open interest and 100+ traded a day |
| 2 | A real business, not a gamble | Passes | Profitable over the last twelve months - not a speculative stock, fund or note |
| 3 | Below fair value | Passes | Trading below the nine-model average fair value (margin of safety above 0) |
| 4 | Financially healthy | Fails | Piotroski 4/9 (under 6) |
| 5 | Can repay its debt | Passes | Long-term debt repaid from 3 years of operating cash flow or less (6 for real estate and utilities; banks and insurers are not judged on it) |
| 6 | No serious red flags | Passes | Red Flags score 60 or more out of 100 (earnings, margins, debt, analysts, filings and price checked the same way for every stock) |
| 7 | A premium worth selling | Passes | Implied volatility 25-80% (enough premium, not a lottery ticket) |
| 8 | Big enough | Passes | Market cap $1 billion or more |
| 9 | Not a penny stock | Passes | Share price $5 or more |
| How it ranks | Rating | From | |
|---|---|---|---|
| Value | Strong | 29% below fair value | |
| Premium | Strong | implied volatility 36% | |
| Moat | Fair | moat 5.5/10 | |
| Health | Fair | Piotroski 4/9 | |
| Red Flags | Strong | Red Flags score 90/100 | |
| Option trading | Weak | 788 contracts a day, 6,909 open interest | |
| Stability | Fair | beta 0.71, $1.6B company |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls: a stock must pass all 9 Wheel Trade Filters to score 70, and the score then ranks the ones that pass; the Sunday Scan is the top 10. It is updated nightly and is not a recommendation. How the Wheel Score works · the walkthrough lesson shows how it fits into a trade, start to finish.
Upcoming events
The next earnings report is due on 1 Feb 2027, 88 days away - outside the window of a 30-45-day put sold today. The shares go ex-dividend on 13 Nov 2026 (0.1934 per share), so a covered call sold before then carries a small early-assignment risk around that date.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Asset Management
The 12 companies below are the closest to Capital Southwest Corporation by market cap within the Asset Management industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| KEGS 1812 Brewing Company Inc. | 1.72 | - | - | 9No options | $1.6B |
| PAX Patria Investments Ltd | 9.76 | 12.67 | +23% | 72Good | $1.6B |
| MQY BlackRock MuniYield Quality Fund, Inc. | 10.60 | 16.52 | +36% | 26No options | $1.6B |
| BST BlackRock Science and Technology Trust | 46.03 | 348.58 | +87% | 33No options | $1.6B |
| ARAAX Horizon Active Risk Assist Fund - Advisor Class | 27.48 | 235.41 | +88% | 26No options | $1.6B |
| RCGTX Virtus Zevenbergen Technology Fund CL C | 16.56 | 20.35 | +19% | 18No options | $1.6B |
| HYT BlackRock Corporate High Yield Fund, Inc. | 7.97 | 13.27 | +40% | 23No options | $1.6B |
| BCHYX American Century California High Yield Municipal Investor Class | 9.33 | 5.76 | -62% | 11No options | $1.6B |
| TRIN Trinity Capital Inc. | 17.94 | 40.05 | +55% | 49Weak | $1.6B |
| GAM General American Investors Company, Inc. | 64.69 | 389.51 | +83% | 31No options | $1.6B |
| RQI Cohen & Steers Quality Income Realty Fund, Inc. | 12.01 | 23.89 | +50% | 24No options | $1.6B |
| GAB The Gabelli Equity Trust Inc. | 5.33 | 30.11 | +82% | 32No options | $1.7B |
⚖ Compare CSWC with 7 of them All Financial Services stocks →
Scan the whole market the same way
A free GLS Equity account gets you nightly fair value and the Wheel Score on ~7,400 US stocks, a watchlist, the scanner preview and the Sunday Scan - the top 10 stocks that pass all 9 Wheel Trade Filters, emailed every week. Pro adds the full put and call scanners, unlimited watchlists with alerts and the trade journal.
Start free See the Sunday ScanQuestions about CSWC
Is CSWC undervalued right now?
By the GLS models, moderately: at 23.79 the stock trades 29% below the average fair value of 33.54 (data as of 5 Nov 2026).
What is the Wheel Score of CSWC and what does it mean?
CSWC scores 49 out of 100 (Weak) - it fails Wheel Trade Filter 4. The Wheel Score ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned - in two parts: the 9 pass/fail Wheel Trade Filters (busy options, a real business, below fair value, Piotroski 6 or more, debt it can repay, a Red Flags score of 60 or more, implied volatility of 25-80%, a $1 billion company, $5 a share) and a ranking of how strongly a stock passes on value, premium, moat, health, red flags, option trading and stability. A stock that fails any filter stays under 70; 70-84 is Good, 85 and above is Prime. The Sunday Scan is the top 10 that pass, sorted by Wheel Score.
What is the GLS fair value for CSWC?
33.54 per share as of 5 Nov 2026 - the simple average of the 7 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Capital Southwest Corporation report earnings next?
The next earnings report is due on 1 Feb 2027, 88 days from the data date of 5 Nov 2026. The Calendars page lists every upcoming report with its time of day.
Does CSWC have listed options, and how liquid are they?
Yes. The nightly snapshot found 24 listed contracts with 6,909 open interest across all expiries and implied volatility of 36% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.