Capital Southwest appoints new CEO and financial officers

DALLAS - Capital Southwest Corporation (NASDAQ:CSWC), a business development company specializing in financing solutions for middle market businesses with a market capitalization of $1.2 billion, has undergone a significant leadership transition. According to InvestingPro data, the company maintains a "GOOD" financial health score and has demonstrated strong revenue growth of 17.5% over the last twelve months. Michael Sarner has been named the new President and Chief Executive Officer, succeeding Bowen Diehl, with the change effective as of Monday. Sarner, who has been with the company since 2015, also joins the Board of Directors.

Diehl, who has led Capital Southwest for a decade, will continue to serve in an advisory role for at least another year. David Brooks, Chairman of the Board, expressed gratitude for Diehl’s leadership and confidence in the smooth transition of power, attributing it to the shared strategic involvement of both Diehl and Sarner.

Alongside Sarner’s promotion, Chris Rehberger has been elevated to Chief Financial Officer, Treasurer & Secretary, and Tabitha Geiger has advanced to Chief Compliance Officer, with both assuming their new positions on Monday as well. Rehberger and Sarner have a shared history, having worked together for two decades, including time at American Capital. Geiger brings nearly a decade of compliance experience, including eight years at compliance consulting firm IQ-EQ.

Sarner’s tenure at Capital Southwest has been marked by his involvement in raising over $2 billion in debt and equity and his role in the company’s corporate and capitalization strategy. His experience spans over thirty years in financial, treasury, and BDC roles. Diehl expressed his optimism for the company’s future under Sarner’s leadership and his pride in the company’s achievements during his tenure.

Capital Southwest, based in Dallas, Texas, manages approximately $1.7 billion in investments, focusing on supporting middle market business growth with investments ranging from $5 million to $50 million. The company’s flexible and long-term investment approach has been a hallmark of its operations, resulting in an impressive track record of maintaining dividend payments for 43 consecutive years. Currently offering a substantial 10.8% dividend yield, the company trades at a P/E ratio of 16.6. InvestingPro subscribers can access detailed valuation metrics and 7 additional key insights about Capital Southwest’s financial position through the comprehensive Pro Research Report.

This leadership change announcement is based on a press release statement issued by Capital Southwest on February 18, 2025. Investors seeking deeper insights into Capital Southwest’s financial health, valuation metrics, and growth prospects can access the full analysis through InvestingPro, which offers exclusive access to advanced financial metrics and expert analysis for over 1,400 US stocks.

In other recent news, Capital Southwest Corporation has been the focus of various financial analysts. JMP Securities maintained a Market Perform rating on Capital Southwest, highlighting its strong position and potential for growth. The firm expects an increase in the company’s investment portfolio and a robust dividend growth into 2025.

Simultaneously, Raymond (NSE:RYMD) James reduced Capital Southwest’s stock price target from $26.00 to $24.00, while maintaining an Outperform rating. This adjustment followed the company’s third fiscal quarter results for 2025, which exceeded expectations due to a rise in fee income and net portfolio growth. The firm also anticipates the company’s net asset value (NAV) to outperform its peers in the upcoming quarters.

Lastly, Lucid (NASDAQ:LCID) Capital Markets initiated coverage on Capital Southwest with a Neutral rating and a price target of $25.00. According to the firm, Capital Southwest should trade at approximately 150% of its 2025 year-end NAV estimate of $16.77. Despite economic uncertainties, the company has experienced an increase in Net Investment Income (NII) due to portfolio growth, leading to an uptick in both regular and supplemental dividends. These are the recent developments concerning Capital Southwest.

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