Small semiconductor nanoclusters are important for understanding the initial formation and growth of quantum dots and also for application, for example in the tunability provided by size. However, electronic structures and effects of capping ligands have not been systematically characterized. Thus, ground and excited state calculations using coupled-cluster methods were carried out to provide benchmarks for evaluating the applicability of density functional theory (DFT) and time-dependent DFT (TDDFT) with different functionals for the ground and excited states, respectively. Our computed data suggests that the popular B3LYP functional does not deliver optimal results for the ground and excited state. While the PBE0 functional was found to provide a good description for both the ground and excited states for small bare (ZnS)n and bare and ligated (CdSe)n clusters, the results for the hydrated (ZnS)n clusters were found to deteriorate significantly. However, the errors appear to decrease with increasing cluster size. Excitation energies obtained with the long-range hybrid CAM-B3LYP and CA-B3LYP were found to provide more consistent results for both anhydrous and hydrated (ZnS)n clusters. However, their performance in spectral predictions for larger clusters requires further study. Using PBE0, electronic structures of the ground and excited states for (ZnS)n and (CdSe)n up to n = 37 using DFT and TDDFT, respectively, were re-examined. With the exception of the cage-core (ZnS)13, (CdSe)13, and (CdSe)14, small (ZnS)n and (CdSe)n are predicted to be spheroids and tubular structures (6, 8-12, 15-19) with squares and hexagons, similar to the structures of carbon single-wall nanotubes. Wurtzite (n = 23-27, 36, 37) and cage-core (n = 29-35) structures are energetically more favorable for larger clusters. We find that water and amines increase the intensities and blue shift the excitations of bare clusters. One photon absorption spectra predicted by TDDFT with the PCM solvation model for (CdSe-methylamine)13 and the larger ligated (CdSe)33 are consistent with the experimental spectra.