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Gladstone Investment Corp (GAIN)
NASDAQ:GAIN
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Gladstone Investment
(NASDAQ:GAIN)
Rating:74Outperform
Price Target:
$16.50
▲( 12.40% Upside)
Gladstone Investment (GAIN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$540.77M
Dividend Yield6.54%
Average Volume (3M)119.61K
Price to Earnings (P/E)8.3
Beta (1Y)0.65
Revenue Growth33.42%
EPS Growth-28.30%
CountryUS
Employees70
SectorFinancial
Sector Strength82
IndustryAsset Management
Share Statistics
EPS (TTM)0.20
Shares Outstanding36,837,380
10 Day Avg. Volume150,964
30 Day Avg. Volume119,611
Financial Highlights & Ratios
PEG Ratio-0.08
Price to Book (P/B)1.08
Price to Sales (P/S)0.00
P/FCF Ratio33.16
Enterprise Value/Market Cap1.81
Enterprise Value/Revenue2.21
Enterprise Value/Gross Profit10.98
Enterprise Value/Ebitda4.45
Forecast
1Y Price Target
$14.25Price Target Upside-2.93% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering3
Gladstone Investment Business Overview & Revenue Model
Company DescriptionGladstone Investment Corporation (GAIN) is a publicly traded business development company that primarily invests in lower middle-market companies in the United States. The company focuses on providing debt and equity capital to privately held businesses, assisting them in various stages of growth. With a diversified portfolio, Gladstone Investment targets sectors such as manufacturing, consumer products, and services, aiming to support companies with stable cash flows and strong market positions.
How the Company Makes MoneyGladstone Investment Corporation generates revenue through interest income from its debt investments and capital gains from its equity investments. The company primarily invests in secured first lien loans, second lien loans, and equity securities, targeting companies with strong management teams and growth potential. Additionally, GAIN may realize capital gains by exiting its equity investments when market conditions are favorable. The company also benefits from dividend income from its equity holdings. Significant partnerships with portfolio companies contribute to its earnings by enhancing the value of its investments through strategic guidance and operational support. Gladstone Investment's ability to effectively manage and grow its investment portfolio is crucial to maintaining its revenue streams.
Gladstone Investment Financial Statement Overview
Summary
Gladstone Investment shows strong long-term profitability and revenue growth, but recent volatility in revenue and increased leverage pose concerns. Cash flow management needs improvement despite transitioning to positive free cash flow.Income Statement
Gladstone Investment has shown strong growth with a significant increase in total revenue from 2020 to 2025. The gross profit margin remains solid, reflecting effective cost management. However, the decline in total revenue between 2024 and 2025 suggests potential volatility. The consistent profitability, indicated by positive EBIT and net income, and high net profit margins are strong points. Yet, the revenue growth rate has fluctuated, indicating potential instability in revenue streams.65
Positive
Balance Sheet
The company's balance sheet reflects a stable equity position with an increasing trend in stockholders' equity over the years. However, the debt-to-equity ratio has increased, highlighting a rise in leverage which could pose risks if not managed carefully. The equity ratio is stable, implying a balanced approach to financing, but the increasing debt levels require monitoring to avoid potential over-leverage.62
Positive
Cash Flow
Cash flow analysis shows a mixed picture, with fluctuations in operating cash flow and free cash flow over the years. The transition from negative to positive free cash flow in recent years is encouraging, but the inconsistency points to potential cash flow management issues. The operating cash flow to net income ratio indicates that the company is generating sufficient cash, but the variability suggests some operational cash challenges.58
Neutral
| Breakdown | ||||
| Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 89.88M | 103.17M | 32.66M | 99.15M | 48.73M | Gross Profit |
| 61.63M | 79.05M | 10.98M | 63.37M | 29.16M | EBIT |
| 65.32M | 85.31M | 51.42M | 118.56M | 44.78M | EBITDA |
| 65.32M | 37.10M | 51.42M | 80.89M | 44.78M | Net Income Common Stockholders |
| 65.32M | 85.31M | 35.55M | 102.32M | 42.45M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 15.15M | 2.46M | 2.68M | 14.19M | 2.06M | Total Assets |
| 1.01B | 938.08M | 765.64M | 740.41M | 643.73M | Total Debt |
| 455.71M | 398.35M | 292.61M | 261.35M | 151.38M | Net Debt |
| 440.56M | 395.13M | 289.92M | 247.16M | 149.32M | Total Liabilities |
| 507.32M | 445.37M | 325.90M | 294.58M | 261.37M | Stockholders Equity |
| 499.08M | 492.71M | 439.74M | 445.83M | 382.36M |
| Cash Flow | Free Cash Flow | |||
| 16.31M | -69.94M | -4.50M | 36.60M | -29.73M | Operating Cash Flow |
| 16.31M | -69.94M | -4.50M | 36.60M | -29.73M | Investing Cash Flow |
| -145.19M | 0.00 | -98.22M | -42.72M | -64.22M | Financing Cash Flow |
| -4.37M | 69.91M | -6.74M | -24.50M | 28.07M |
Gladstone Investment Technical Analysis
Positive
14.68
Price Trends
13.57
Positive
13.33
Positive
12.98
Positive
Market Momentum
0.35
Negative
66.10
Neutral
69.41
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GAIN, the sentiment is Positive. The current price of 14.68 is above the 20-day moving average (MA) of 14.11, above the 50-day MA of 13.57, and above the 200-day MA of 12.98, indicating a bullish trend. The MACD of 0.35 indicates Negative momentum. The RSI at 66.10 is Neutral, neither overbought nor oversold. The STOCH value of 69.41 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GAIN.
Gladstone Investment Risk Analysis
Gladstone Investment disclosed 12 risk factors in its most recent earnings report. Gladstone Investment reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Gladstone Investment Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $540.77M | 8.26 | 13.17% | 6.54% | 33.42% | -28.30% | |
70 Neutral | $583.48M | 6.68 | 18.92% | 7.58% | 69.53% | 60.29% | |
64 Neutral | $12.67B | 9.74 | 7.58% | 17015.08% | 12.21% | -6.96% | |
61 Neutral | $570.38M | 11.51 | 6.70% | 10.92% | 12.83% | -13.29% | |
58 Neutral | $504.75M | 15.47 | -1.88% | 15.03% | 2.30% | -63.97% | |
51 Neutral | $451.61M | 27.73 | 3.05% | 11.61% | 1.13% | -86.09% | |
48 Neutral | $430.30M | 44.56 | 1.95% | 14.26% | ― | -66.59% |
* Financial Sector Average
Performance Comparison
GAIN
Gladstone Investment
14.68
2.35
19.06%
GLAD
Gladstone Capital
26.13
5.85
28.85%
PNNT
Pennantpark Investment
6.59
0.15
2.33%
CCAP
Crescent Capital BDC
15.39
-0.82
-5.06%
CION
CION Investment Corp
9.58
-1.30
-11.95%
PSBD
Palmer Square Capital BDC Inc.
13.95
-0.71
-4.84%
Gladstone Investment Earnings Call Summary
Earnings Call Date:May 13, 2025
(Q4-2025)
| % Change Since: 5.08%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Positive
The earnings call presented a generally positive outlook with strong fiscal year performance, significant realized gains, and increased investment activity. However, there are some concerns regarding the slight decrease in portfolio value, ongoing non-accrual status of some portfolio companies, and exposure to tariff risks.Q4-2025 Updates
Positive Updates
Strong Fiscal Year Performance
Gladstone Investment Corporation reported adjusted net investment income (NII) of $0.97 per share for the fiscal year, covering the $0.96 per share annual dividend. The total fair value of the portfolio increased to $979 million, up from $921 million at the prior year end.
Successful Exits and Realized Gains
The company successfully exited one of its portfolio companies, generating significant realized capital gains of $19.8 million.
Increased Investment Activity
For the year, Gladstone invested $221 million, up from $184 million in the prior year, including investments in four new portfolio companies.
Supplemental Distributions
Supplemental distributions of $1.66 per share were paid during the fiscal year, with an additional $0.54 per share declared post year-end.
Strong Investment Income Growth
Total investment income reached $93.7 million, up from $87.3 million in the prior year, driven by an increase in dividend and success fee income.
Strong Liquidity Position
Gladstone issued $126.5 million of publicly traded notes and completed an upsize of its credit facility to $270 million, with $214 million available.
Negative Updates
Slight Decrease in Portfolio Value
The portfolio value decreased slightly quarter-over-quarter from $1.1 billion, primarily due to exits and adjustments in valuation multiples.
Non-Accrual Status of Portfolio Companies
Four portfolio companies remain on non-accrual status, although improvements are noted in a few, with ongoing efforts to return them to accrual status.
Exposure to Tariff Risks
Concerns about tariff impacts on supply chains and customer demand were highlighted, with a specific focus on consumer-focused companies.
Company Guidance
During the fourth quarter and fiscal year ended March 31, 2025, Gladstone Investment Corporation reported positive financial performance, with an adjusted net investment income (NII) of $35.5 million, equating to $0.97 per share, thereby covering their annual dividend of $0.96 per share. The total fair value of their portfolio increased to $979 million, though it was slightly lower than the previous quarter's $1.1 billion. This discrepancy was due to a balance of new buyouts and the successful exit of a portfolio company, yielding significant realized capital gains of $19.8 million. Throughout the year, the company invested $221 million across four new portfolio companies and completed a dividend recap with Educators Resource. They maintained a monthly distribution of $0.08 per share and paid supplemental distributions totaling $1.66 per share for the year. Looking ahead, the management is cautiously optimistic about new acquisitions, despite economic uncertainties such as tariffs, and reported a net asset value (NAV) increase to $13.55 per share. The company ended the fiscal year with $55.3 million in spillover, sufficient for future distributions, and emphasized maintaining liquidity and flexibility to support portfolio growth.Gladstone Investment Corporate Events
DividendsFinancial Disclosures
Gladstone Investment Declares Monthly Cash Distributions
Positive
Apr 8, 2025
On April 8, 2025, Gladstone Investment Corporation announced that its board of directors declared monthly cash distributions for its common stockholders for April, May, and June 2025, along with a supplemental distribution in June. The company also plans to report its fourth fiscal quarter earnings on May 13, 2025, followed by a conference call on May 14, 2025, to discuss the results. These announcements reflect the company’s ongoing commitment to providing returns to its shareholders and maintaining transparency in its financial operations.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.