Gladstone Investment (GAIN) AI Stock Analysis

• Market Cap: $527.43M
• Dividend Yield: 10.85%
• Average Volume (3M): 160.61K
• Price to Earnings (P/E): 6.4
• Beta (1Y): 0.59
• Revenue Growth: 33.75%
• EPS Growth: 6.20%
• Country: US
• Employees: 70
• Sector: Financial
• Sector Strength: 70
• Industry: Asset Management
• EPS (TTM): 0.25
• Shares Outstanding: 38,219,230
• 10 Day Avg. Volume: 222,745
• 30 Day Avg. Volume: 160,608
• PEG Ratio: -0.27
• Price to Book (P/B): 0.98
• Price to Sales (P/S): 5.46
• P/FCF Ratio: 30.09
• Enterprise Value/Market Cap: 1.97
• Enterprise Value/Revenue: 9.18
• Enterprise Value/Gross Profit: 11.88
• Enterprise Value/Ebitda: 11.68
• 1Y Price Target: $14.50
• Price Target Upside: 4.84% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 63 Neutral
• Price Target: $14.50 ▲(4.84% Upside)

Gladstone Investment's strong valuation and profitability are offset by technical weakness and cash flow challenges. The earnings call provided a balanced view with both positive investment activity and notable risks, leading to a moderate overall score.

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

Gladstone Investment shows strong revenue growth and profitability, with a net profit margin of 64.53%. However, the cash flow challenges, including negative operating and free cash flows, and increasing debt levels highlight potential risks.

Income Statement

Gladstone Investment shows strong revenue growth with a 25.99% increase in TTM, indicating robust business expansion. The company maintains high profitability with a net profit margin of 64.53% and an EBIT margin of 64.53% in TTM. However, the gross profit margin has decreased from previous periods, suggesting rising costs or pricing pressures.

Balance Sheet

The company's debt-to-equity ratio of 0.94 in TTM is relatively stable, indicating a balanced approach to leveraging. Return on Equity (ROE) is healthy at 14.87%, reflecting efficient use of equity. However, the increasing debt levels over the years could pose a risk if not managed properly.

Cash Flow

The cash flow situation is concerning, with negative operating and free cash flows in TTM. The free cash flow growth rate is significantly negative, indicating potential liquidity issues. The operating cash flow to net income ratio is negative, suggesting that earnings are not translating into cash effectively.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	113.24M	89.88M	103.17M	48.53M	112.23M	53.17M
Gross Profit	87.57M	61.63M	79.05M	32.66M	99.15M	48.73M
EBITDA	89.03M	65.32M	85.31M	35.55M	102.32M	42.45M
Net Income	79.62M	65.32M	85.31M	35.55M	102.32M	42.45M
Balance Sheet
Total Assets	1.05B	1.01B	938.08M	765.64M	740.41M	643.73M
Cash, Cash Equivalents and Short-Term Investments	5.36M	14.30M	2.46M	2.68M	14.19M	2.06M
Total Debt	456.36M	455.71M	398.35M	292.61M	261.35M	243.59M
Total Liabilities	568.61M	507.32M	445.37M	325.90M	294.58M	261.37M
Stockholders Equity	485.30M	499.08M	492.71M	439.74M	445.83M	382.36M
Cash Flow
Free Cash Flow	-43.79M	16.31M	-69.94M	-4.50M	36.60M	-29.73M
Operating Cash Flow	-43.79M	16.31M	-69.94M	-4.50M	36.60M	-29.73M
Investing Cash Flow	-139.48M	0.00	-155.92M	-98.22M	-42.72M	-64.22M
Financing Cash Flow	42.15M	-4.37M	69.91M	-6.74M	-24.50M	28.07M

Gladstone Investment Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 13.83
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GAIN, the sentiment is Negative. The current price of 13.83 is below the 20-day moving average (MA) of 14.01, below the 50-day MA of 13.97, and above the 200-day MA of 13.13, indicating a neutral trend. The MACD of -0.03 indicates Positive momentum. The RSI at 41.82 is Neutral, neither overbought nor oversold. The STOCH value of 11.99 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GAIN.

Gladstone Investment Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GLAD	70 Neutral	499.30M	6.64	―	10.01%	47.88%	-5.08%
CCAP	68 Neutral	568.52M	12.87	9.94%	12.61%	-7.13%	-56.63%
GAIN	63 Neutral	$527.43M	6.37	16.54%	10.85%	33.75%	6.20%
CION	58 Neutral	504.20M	-50.89	―	15.39%	-11.83%	-108.11%
PSBD	55 Neutral	428.24M	23.74	8.86%	13.45%	0.36%	-80.23%
PNNT	48 Neutral	436.83M	31.07	―	14.29%	-35.46%	-67.15%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

Gladstone Investment Corporate Events

Gladstone Investment’s 2025 Annual Meeting Approvals

On August 7, 2025, Gladstone Investment Corporation held its 2025 Annual Meeting of Stockholders, where stockholders approved all proposals presented, including the election of two directors and the ratification of PricewaterhouseCoopers LLP as the independent accounting firm for the fiscal year ending March 31, 2026. These approvals reflect strong shareholder support and are expected to positively influence the company’s governance and financial oversight, reinforcing its position in the financial services industry.

Gladstone Investment Declares Monthly Cash Distributions

On July 10, 2025, Gladstone Investment Corporation announced that its board of directors declared monthly cash distributions of $0.08 per share for its common stockholders for July, August, and September 2025. Additionally, the company plans to report its earnings for the first fiscal quarter ended June 30, 2025, on August 12, 2025, followed by a conference call on August 13, 2025, to discuss the results. This announcement highlights the company’s ongoing commitment to providing returns to its shareholders and maintaining transparency with its financial performance.

Gladstone Investment Updates Sales Agreements with M&T Securities

On June 2, 2025, Gladstone Investment Corporation announced amendments to its sales agreements with several sales agents, including the addition of M&T Securities, Inc. as a new sales agent. These agreements allow for the issuance of up to $75 million of common stock, with M&T acting as a sales agent under mutually agreed terms and earning a commission of up to 2.0% on sales, while also being indemnified against certain liabilities.