Important news for shareholders and potential investors in Capital Southwest Corporation (NASDAQ:CSWC): The dividend payment of $0.26 per share will be distributed into shareholder on 02 January 2018, and the stock will begin trading ex-dividend at an earlier date, 14 December 2017. So if you want to cash in on CSWC’s dividend payment and are not yet a shareholder, you have only few days left! Today I am going to take a look at CSWC’s most recent financial data to examine its dividend characteristics in more detail. Check out our latest analysis for Capital Southwest
5 checks you should use to assess a dividend stock
When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:
- Is their annual yield among the top 25% of dividend payers?
- Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?
- Has dividend per share amount increased over the past?
- Is its earnings sufficient to payout dividend at the current rate?
- Will it be able to continue to payout at the current rate in the future?
How well does Capital Southwest fit our criteria?
The current payout ratio for the stock is 46.28%, which means that the dividend is covered by earnings. Furthermore, analysts have not forecasted a dividends per share for the future, which makes it hard to determine the yield shareholders should expect, and whether the current payout is sustainable, moving forward. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. Although CSWC’s per share payments have increased in the past 10 years, it has not been a completely smooth ride. Investors have seen reductions in the dividend per share in the past, although, it has picked up again. Relative to peers, Capital Southwest produces a yield of 6.11%, which is high for capital markets stocks.
What this means for you:
Are you a shareholder?
Are you a shareholder? With Capital Southwest producing strong dividend income for your portfolio over the past few years, you can take comfort in knowing that this stock will still continue to be a robust dividend generator moving forward. However, depending on your current portfolio, it may be beneficial exploring other income stocks to enhance your diversification, or even look at high-growth stocks to supplement your steady income stocks. I recommend continuing your research by taking a look at my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.
Are you a potential investor? With these dividend metrics in mind, I definitely rank Capital Southwest as a strong income stock, and is worth further research for anyone who considers dividends an important part of their portfolio strategy. I also recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. Another aspect to consider for CSWC is how much it’s actually worth. Can you buy CSWC for a great price? Dig deeper in our latest free analysis to find out!
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.