4-Star Stocks Poised to Pop: Apollo Investment

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, business-development company Apollo Investment (Nasdaq: AINV  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Apollo's business and see what CAPS investors are saying about the stock right now.

Apollo facts

Headquarters (Founded)	New York (2004)
Market Cap	$1.67 billion
Industry	Diversified investments
Trailing-12-Month Revenue	$375.1 million
Management	CEO James Charles Zelter COO Patrick Dalton
Return on Equity (Average, Past 3 Years)	(4.1%)
Cash/Debt	$9.2 million / $1.25 billion
Dividend Yield	13.1%
Competitors	American Capital (Nasdaq: ACAS  )

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 97% of the 1,185 members who have rated Apollo believe the stock will outperform the S&P 500 going forward. These bulls include floridaboy32826 and gameguru.

This past summer , floridaboy32826 tapped Apollo as an attractive income opportunity: "Solid dividend and good management. [Quarterly dividend] has been steady @ 0.28 per share. ... Stock will bounce back."

Currently, Apollo even sports a cheapish forward P/E of 8.4. That represents a slight discount to other business-developm! ent comp anies like American Capital (9.3), BlackRock Kelso Capital (Nasdaq: BKCC  ) (8.8), and Main Street Capital (NYSE: MAIN  ) (11.1).

CAPS member gameguru elaborates on the bargain opportunity:

[Apollo Investment] looks extraordinarily cheap right now. ... The risk here is that they're inflating NAV by carrying their companies at overly high book values, but with past writedowns, this risk is lessened. They have a buyback program in place and the CFO bought a small slug of shares in August, so insider buying is favorable.

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