Forensic Analysis · General / Diversified · as of Sep 25, 2026
Capital Southwest Corp (CSWC)
A forensic read on Capital Southwest Corp built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
D · Weak — demands caution
Forensic grade
Clean
Earnings quality
5
Forensic signals
13.5
P / E (ttm)
11.2%
ROE
$1.4B
Market cap
10.71%
Dividend yield
13.5%
Revenue growth
This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (red flags, auditor quality, say on pay, board independence, going concern, valuation). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.
Capital Southwest Corp earns a D (Weak — demands caution) forensic quality grade. 5 forensic signals were flagged in its latest SEC filings, led by cash conversion.
What the filings flag
-2.24×
FY2024–FY2026
Cash conversion.Over FY2024–FY2026, cumulative operating cash flow was -2.24× cumulative net income. Reported profit is not turning into cash. The shortfall is profit tied up in working capital rather than collected — the accrual and receivables lines below show where.
+27.1%/yr
FY2024–FY2026
Share-count dilution.Diluted share count changed +62% over the last 2 years to FY2026 (+27.1%/yr). The count is growing: more stock was issued than repurchased over this window, so aggregate results grew faster than their per-share equivalents. That's ~27.1% shaved off per-share growth every year — total profit has to grow that much just to keep earnings-per-share flat, and a stake held since FY2024 has been diluted ~38%.
FCF ($194M)
FY2026
Shareholder returns.Returned $147M to shareholders (buybacks + dividends) in FY2026, but free cash flow was ($194M) after capex — there was no free cash flow to fund the payout from at all, and operating cash flow itself was negative or zero that year too. The entire return is coming from debt or cash reserves, not cash the business itself generated — a harder case than returns merely running ahead of free cash flow, since here there was none to run ahead of.
+16.2%
FY2025→FY2026
Accruals ratio (% of NOA).Net operating assets grew +16.2% relative to their own average in FY2026 — scaled by NOA itself, not by total assets, which is what the Forensic Screens card's own accrual row divides by. Accruals are building faster than is comfortable — part of profit is sitting in the balance sheet rather than turning to cash. A cash-flow measure on the same base agrees: reported earnings ran ahead of operating cash by 16% of net operating assets, against an accruals ratio of 16.2%. The two are computed differently: the accruals ratio is the change in net operating assets over average net operating assets, while the cash-flow figure is net income less operating cash flow over that same average.
Key fundamentals
Free Cash Flow-$193.8M
Return on Equity11.2%
Debt / Equity1.12x
The forensic grade and screens above are free — no account needed. Want the AI investment read on top — the 0–100 rating, thesis, bull-vs-bear, red flags and the 12-month scenario, written from Capital Southwest Corp's actual 10-K/10-Q/8-K filings?
Data from SEC EDGAR public filings · metrics as of Sep 25, 2026. Forensic signals flag probability, not certainty.
Capital Southwest Corp (CSWC) Stock — Forensic Analysis, Red Flags & Rating | Stockonomy · Stockonomy
-9%
FY2025→FY2026
Dividend — cut.The payout was CUT ~9% in FY2026 (from FY2025). It still returns some cash, but it is NOT the dependable, rising dividend an unbroken streak implies.