This post is part of a special annual report -- Top Stock Picks '09 -- in which TheStockAdvisors.com asked 75 leading newsletter advisors to select their favorite investment for the new year.
"I've followed Gladstone Capital (NASDAQ: GLAD) for many years," says Mark Skousen in Forecasts & Strategies. Here, he chooses the business development company as a top idea for 2009.
"Gladstone is a business development company (BDC) run by the 'father of BDCs,' David Gladstone. Gladstone is a conservative investor who is careful in his lending.
"His investment company, Gladstone Capital, specializes in debt investments in small- and medium-sized companies that seek additional funding, recapitalization, debt reduction, and short-term bridge financing.
"Unlike other BDCs, Gladstone always has been prudent in its lending. It has no exposure to subprime mortgages and no exposure to home building -- but it is being hurt by U.S. recession fears.
"Though the shares are volatile, I think the stock is dirt cheap, having suffered a sharp sell-off due to the deep recession and financial crisis.
"It is off 70% so far this year, which is far too much, in my judgment. With any kind of economic recovery under an Obama administration, I expect Gladstone to be back in good form.
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