Analyzing Gladstone Investment (GAIN) & Firsthand Technology Value Fund (SVVC)

Gladstone Investment (NASDAQ:GAIN) and Firsthand Technology Value Fund (NASDAQ:SVVC) are both small-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their dividends, valuation, profitability, earnings, institutional ownership, analyst recommendations and risk.

Profitability

This table compares Gladstone Investment and Firsthand Technology Value Fund’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Gladstone Investment 168.91% 6.58% 3.87%
Firsthand Technology Value Fund 2,592.77% -9.75% -9.08%

Valuation and Earnings

This table compares Gladstone Investment and Firsthand Technology Value Fund’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Gladstone Investment $58.35 million 5.80 $60.68 million $0.82 12.59
Firsthand Technology Value Fund $1.57 million 60.60 $26.17 million N/A N/A

Gladstone Investment has higher revenue and earnings than Firsthand Technology Value Fund.

Dividends

Gladstone Investment pays an annual dividend of $0.82 per share and has a dividend yield of 7.9%. Firsthand Technology Value Fund does not pay a dividend. Gladstone Investment pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Gladstone Investment has raised its dividend for 6 consecutive years.

Insider & Institutional Ownership

15.5% of Gladstone Investment shares are owned by institutional investors. Comparatively, 4.4% of Firsthand Technology Value Fund shares are owned by institutional investors. 2.5% of Gladstone Investment shares are owned by company insiders. Comparatively, 3.6% of Firsthand Technology Value Fund shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Volatility & Risk

Gladstone Investment has a beta of 0.59, indicating that its share price is 41% less volatile than the S&P 500. Comparatively, Firsthand Technology Value Fund has a beta of 1.19, indicating that its share price is 19% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Gladstone Investment and Firsthand Technology Value Fund, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Gladstone Investment 0 0 2 0 3.00
Firsthand Technology Value Fund 0 0 0 0 N/A

Gladstone Investment currently has a consensus target price of $11.00, indicating a potential upside of 6.59%. Given Gladstone Investment’s higher possible upside, equities research analysts clearly believe Gladstone Investment is more favorable than Firsthand Technology Value Fund.

Summary

Gladstone Investment beats Firsthand Technology Value Fund on 9 of the 14 factors compared between the two stocks.

Gladstone Investment Company Profile

Gladstone Investment Corporation is a private equity fund specializing in lower middle market, acquisitions, mature stage, buyouts; recapitalizations; 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 seek to invest in manufacturing, consumer products and business services/ distribution 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 sales between $20 million and $100 million. The fund invest 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 its investments for seven years and exits via sale or recapitalization, initial public offering, or sale to third party.

Firsthand Technology Value Fund Company Profile

Firsthand Technology Value Fund, Inc. is a publicly traded ventures capital fund invests in companies located in the US. The fund target companies operating in the fields of game changing technology and cleantech services. It provides financing in the form of equity and debt for early, growth and later stage capital requirements with an investment size ranges between $1 and $10 million.

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