Forensic Analysis · General / Diversified · as of Aug 11, 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.
F · Poor — capital at risk
Forensic grade
Clean
Earnings quality
6
Forensic signals
14.4
P / E (ttm)
11.2%
ROE
$1.6B
Market cap
9.38%
Dividend yield
16.1%
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). 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 an F (Poor — capital at risk) forensic quality grade. 6 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, 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.
+29.9%/yr
FY2023–FY2026
Share-count dilution.Diluted share count changed +119% over the last 3 years to FY2026 (+29.9%/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 ~29.9% 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 FY2023 has been diluted ~54%.
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 total assets (see the Forensic Screens card's differently-scaled Sloan Accrual Ratio for that read). Accruals are building faster than is comfortable — part of profit is sitting in the balance sheet rather than turning to cash. This is the fourth straight fiscal year of building accruals — an even longer streak than the 3-year mark that already signals a materially stronger tell. The cash-flow cross-check agrees: reported earnings ran ahead of operating cash by 16% of net operating assets.
Key fundamentals
Latest Revenue$10.8M
Revenue Growth YoY+16.1%
Revenue CAGR (3yr)+21.0%
Free Cash Flow-$193.8M
Return on Equity11.2%
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 Aug 11, 2026. Forensic signals flag probability, not certainty.
Capital Southwest Corp (CSWC) Stock — Forensic Analysis, Red Flags & Rating | Stockonomy · Stockonomy
11% of rev
FY2012
Stock-based comp load.Stock-based compensation ran 11% of revenue in FY2012. The cost of it is not in the cash flow — no cash left the business — it is in the count, and there it has run at about 30.0% a year and is falling.
-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.