Gladstone Investment Corporation (GAIN) DCF Valuation
GAIN DCF: $60M TTM NII, $280M net debt, buyout + lending hybrid, 5% growth.
BDC valuation methodology
NII (Net Investment Income) as cash-flow proxy. Buyout equity component adds NAV upside beyond loan book.
BDC — Buyout · Founded 2002 · Beta 1.00
Gladstone Investment Corporation
Current price: $13.20 · Market cap ≈ $0.7B
GAIN's $60M TTM NII is small but stable, and the structure is differentiated: unlike most BDCs, GAIN runs equity buyouts (not just loans) for permanent capital. The $280M net debt is conservative. Monthly dividend. NII as a cash-flow proxy is appropriate for BDCs — actual cash distributions come from interest collected on the loan book minus interest paid on borrowings. Higher growth assumption reflects Gladstone's sponsor-style deal flow; higher WACC reflects smaller scale + equity-component volatility from the buyout book.
DCF Valuation Inputs
High-growth phase
Decay/growth normalization
Perpetual (≤ WACC)
Must be > terminal growth
in millions
Enterprise Value
$1M
Equity Value
$1M
Per Share
$0
Upside / (Downside)
-100.0%
PV of explicit FCF
$0M
Terminal value
$1M
PV of terminal
$1M
Terminal % of EV
74.5%
| Year | Growth | FCF ($M) | Discount Factor | PV ($M) |
|---|---|---|---|---|
| 0 | base | $0 | 1.000 | — |
| 1 | 5.0% | $0 | 0.917 | $0 |
| 2 | 5.0% | $0 | 0.842 | $0 |
| 3 | 5.0% | $0 | 0.772 | $0 |
| 4 | 5.0% | $0 | 0.708 | $0 |
| 5 | 5.0% | $0 | 0.650 | $0 |
| Terminal | perpetual | — | — | $1 |
Discount factor = 1 / (1 + WACC)ⁿ. Terminal value computed using the Gordon Growth Model: TV = FCF_N × (1 + g) / (WACC − g), then discounted back to present.
| g ＼ WACC | 7.0% | 8.0% | 9.0% | 10.0% | 11.0% |
|---|---|---|---|---|---|
| 1.5% | $0 | $0 | $0 | $0 | $0 |
| 2.0% | $0 | $0 | $0 | $0 | $0 |
| 2.5% | $0 | $0 | $0 | $0 | $0 |
| 3.0% | $0 | $0 | $0 | $0 | $0 |
| 3.5% | $0 | $0 | $0 | $0 | $0 |
Highlighted cell is your current WACC × terminal-growth assumption. Cells beyond WACC ≤ g are undefined (Gordon Growth fails).
GAIN DCF: At Default Assumptions
| Item | Value | Notes |
|---|---|---|
| Current price | $13.20 | Market |
| Intrinsic value (per share) | $0.01 | DCF model output |
| Upside / (Downside) | -99.9% | vs current price |
| Enterprise value | $$1M | PV of explicit FCF + terminal |
| Equity value | $$1M | EV − net debt |
| Key fact | Buyout + lending hybrid — equity stakes in profitable SMBs | |
Numbers reflect TTM fundamentals + default DCF assumptions (9.0% WACC, 2.5% terminal growth, 5% Year-1 growth, 5% Years 2+). Use the calculator above to run your own scenario.
GAIN Sources & References
- SEC EDGAR: latest 10-K filing, 10-Q filings, and proxy statement for Gladstone Investment Corporation (GAIN). sec.gov
- Yahoo Finance: real-time price snapshot, analyst consensus growth estimates, and 52-week range.
- S&P Capital IQ: WACC build (cost of equity via CAPM + after-tax cost of debt).
- Federal Reserve Economic Data (FRED): risk-free rate for CAPM, sector beta benchmarks. fred.stlouisfed.org
- Damodaran Online (NYU): BDC — Buyout sector WACC and beta benchmarks for cross-validation. pages.stern.nyu.edu
Related GAIN valuation searches
These are common GAIN valuation questions answered by the DCF model above.
GAIN sector peers & related DCF models
24 cross-links below: same-sector tickers shown first for topical authority, then a broader sample across all 112 covered assets.
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Author
Maya Chen, CFA
Chartered Financial Analyst
Independently reviewed
Dr. Aaron Pak, PhD
Doctor of Kinesiology & Public Health
Last reviewed: August 12, 2026 · Next scheduled review: quarterly
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Cross-checked against authoritative formulas (IRS, NIST, ACSM) and updated for 2025/2026 tax years and rates.
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