Gladstone Investment (GAIN) AI Stock Analysis

• Market Cap: $559.10M
• Dividend Yield: 11.02%
• Average Volume (3M): 150.22K
• Price to Earnings (P/E): 4.5
• Beta (1Y): 0.59
• Revenue Growth: -45.46%
• EPS Growth: 134.73%
• Country: US
• Employees: 70
• Sector: Financial
• Sector Strength: 70
• Industry: Asset Management
• EPS (TTM): -0.16
• Shares Outstanding: 39,821,968
• 10 Day Avg. Volume: 177,778
• 30 Day Avg. Volume: 150,222
• PEG Ratio: -0.27
• Price to Book (P/B): 0.98
• Price to Sales (P/S): 5.46
• P/FCF Ratio: 4.31
• Enterprise Value/Market Cap: 1.78
• Enterprise Value/Revenue: 8.82
• Enterprise Value/Gross Profit: 12.32
• Enterprise Value/Ebitda: 17.14
• 1Y Price Target: $14.67
• Price Target Upside: 5.84% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 60 Neutral
• Price Target: $14.50 ▲(4.62% Upside)

The score is held back primarily by weak and volatile cash generation (negative TTM operating/free cash flow) and declining TTM revenue, despite strong reported profitability. Attractive valuation (low P/E and high dividend yield) and a generally steady earnings-call backdrop (higher NAV and maintained distribution, but pressured NII/expenses and non-accruals) provide support, while technical signals are broadly neutral.

Positive Factors

Strong Reported Profitability

Reported margins and ROE are very strong, indicating the firm earns substantial spread and gains on investments. A meaningful equity base versus assets provides a durable capital cushion to absorb credit stress and support distributions and underwriting through cycles.

Liquidity & Liability Management

A healthy asset coverage ratio well above regulatory minimums, an expanded committed facility and proactive debt refinancings reduce funding risk. This durable liquidity and lower interest burden increase capacity to finance new buyouts and manage maturities over the medium term.

Yield Protection & Underwriting Discipline

Interest-rate floors and conservative underwriting on new originations structurally protect net investment income from rate declines. With a sizable portion of the portfolio floored, recurring interest income is less sensitive to short-term benchmark moves, supporting steadier yields.

Negative Factors

Weak Cash Generation

A material swing to negative operating/free cash flow undermines financial flexibility: it raises dependence on realizations, financing and equity raises to fund distributions and investments. Persistent cash volatility threatens the repeatability of reported earnings and payout coverage.

Expense & Fee Volatility

Large, accrual-driven swings in incentive fees and operating expenses compressed net investment income and produced a quarterly net loss. If incentive-fee accruals and expense volatility persist, recurring distributable income and payout stability could be impaired over the medium term.

Credit Stress & Distribution Cushion Shrinkage

Non-accrual positions and a >50% drop in spillover reduce the buffer available for supplemental distributions and raise reliance on realizations. Concentrated problem assets could force write-downs or additional capital actions, pressuring payouts and balance-sheet flexibility.

Gladstone Investment Business Overview & Revenue Model

Company Description

Gladstone Investment Corporation is business development company, specializes in lower middle market, mature stage, buyouts; refinancing existing debt; senior debt securities such as senior loans, senior term loans, lines of credit, and senior notes; senior subordinated debt securities such as senior subordinated loans and senior subordinated notes; junior subordinated debt securities such as subordinated notes and mezzanine loans; limited liability company interests, and warrants or options. The fund does not invest in start-ups. The fund seeks to invest in manufacturing, consumer products and business/consumer services sector. It seeks to invest in small and mid-sized companies based in the United States. The fund prefers to make debt investments between $5 million and $30 million and equity investments between $10 million and $40 million in companies. The fund seeks to invest in companies with revenue between $20 million and $100 million. The fund invests in companies with EBITDA from $3 million to $20 million. It seeks minority equity ownership and prefers to hold a board seat in its portfolio companies. It also prefers to take majority stake in its portfolio companies. The fund typically holds the investments for seven years and exits via sale or recapitalization, initial public offering, or sale to third party.

How the Company Makes Money

Gladstone Investment makes money primarily through its investments in private companies, which yield returns in several ways. The company earns interest income from debt investments, typically in the form of loans to its portfolio companies, which are often structured with higher interest rates due to the higher risk associated with small to mid-sized businesses. Additionally, GAIN generates revenue from equity investments, receiving dividends and potential capital gains when portfolio companies grow and either go public or are sold. The company also benefits from management fees associated with its investment operations and may have performance-based fees depending on the success of its investments. Significant partnerships with financial institutions and investment networks can enhance its deal flow and investment opportunities, further contributing to its earnings.

Gladstone Investment Financial Statement Overview

Summary

Strong reported profitability (very high net/EBIT margins) and a decent equity base are positives, but TTM revenue declined (-14.8%) and TTM operating/free cash flow swung to meaningfully negative (-$81.8M). Moderate leverage increases the importance of more consistent cash generation.

Income Statement

TTM (Trailing-Twelve-Months) revenue declined (-14.8%), following a nearly flat most recent annual period and a choppy multi-year revenue path. Profitability appears very strong on reported margins (TTM net margin ~79% and EBIT margin ~79%), and return on equity is solid in the latest periods, but the large year-to-year swings in margins and growth suggest earnings quality/recurrence may be less stable than the headline profitability implies.

Balance Sheet

Leverage is moderate for the profile: total debt is sizable ($443M TTM) with debt-to-equity around ~0.85 (down from ~0.91 most recent annual), and equity is meaningful ($595M TTM) against $1.24B in assets. Returns on equity improved versus earlier years, which is a positive, but the balance sheet still carries enough leverage that earnings or asset-value volatility could pressure flexibility.

Cash Flow

Cash generation is the main weak spot: TTM operating cash flow and free cash flow are both negative (-$81.8M), a sharp reversal versus the prior annual period’s strong positive free cash flow (~$113.9M). The large decline in free cash flow growth and the swing from positive to negative cash flow indicate higher volatility in cash realizations and reduced near-term financial flexibility despite strong reported net income.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	89.88M	103.17M	48.53M	112.23M	53.17M
Gross Profit	61.63M	79.05M	32.66M	99.15M	48.73M
EBITDA	65.32M	85.31M	35.55M	102.32M	42.45M
Net Income	65.32M	85.31M	35.55M	102.32M	42.45M
Balance Sheet
Total Assets	1.01B	938.08M	765.64M	740.41M	643.73M
Cash, Cash Equivalents and Short-Term Investments	14.30M	2.46M	2.68M	14.19M	2.06M
Total Debt	455.71M	398.35M	292.61M	261.35M	243.59M
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	113.92M	85.99M	-4.50M	77.94M	44.81M
Operating Cash Flow	113.92M	85.99M	-4.50M	77.94M	44.81M
Investing Cash Flow	-97.62M	-155.92M	-98.22M	-41.34M	-74.54M
Financing Cash Flow	-4.37M	69.91M	-6.74M	-24.50M	28.07M

Gladstone Investment Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 13.86
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: 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 13.86 is below the 20-day moving average (MA) of 13.86, above the 50-day MA of 13.80, and above the 200-day MA of 13.57, indicating a bullish trend. The MACD of 0.03 indicates Negative momentum. The RSI at 57.06 is Neutral, neither overbought nor oversold. The STOCH value of 50.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GAIN.

Gladstone Investment Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
CCAP	63 Neutral	$531.95M	14.80	4.92%	13.20%	-20.18%	-61.90%
CION	63 Neutral	$464.01M	17.75	3.22%	15.77%	-11.01%	-65.56%
GLAD	61 Neutral	$461.80M	13.56	11.86%	9.31%	41.12%	-40.68%
GAIN	60 Neutral	$559.10M	4.52	22.16%	11.02%	-45.46%	134.73%
PNNT	54 Neutral	$377.41M	11.53	6.83%	16.61%	-3.09%	200.66%
TCPC	50 Neutral	$431.84M	―	-1.15%	21.13%	-91.81%	78.46%

Gladstone Investment Corporate Events

Gladstone Investment to Redeem 8% Notes by December

On November 14, 2025, Gladstone Investment Corporation announced its decision to redeem all of its outstanding 8.00% notes due 2028, amounting to $74,750,000, on December 16, 2025. This move will result in the delisting of these notes from the Nasdaq Global Select Market, potentially impacting the company’s financial structure and market positioning.

The most recent analyst rating on (GAIN) stock is a Hold with a $14.00 price target. To see the full list of analyst forecasts on Gladstone Investment stock, see the GAIN Stock Forecast page.

Gladstone Investment Announces $60M Notes Offering

On November 6, 2025, Gladstone Investment Corporation announced the pricing of a registered direct offering of $60 million in 6.875% Notes due 2028, with the offering closing on November 10, 2025. The proceeds from this offering are intended to repay part of the company’s credit facility, fund new investments, and support other corporate purposes, potentially impacting its investment strategy and financial positioning.

The most recent analyst rating on (GAIN) stock is a Hold with a $14.00 price target. To see the full list of analyst forecasts on Gladstone Investment stock, see the GAIN Stock Forecast page.