TD Cowen analyst Michael Elias maintained a Buy rating on AFC Gamma (AFCG – Research Report) today and set a price target of $12.00.
Michael Elias has given his Buy rating due to a combination of factors surrounding AFC Gamma’s position in the cannabis lending market. Despite the recent dividend cut, which was driven by defaults on legacy loans, Elias views the company’s focus as a pure-play cannabis lender as advantageous. In a market with fewer lenders, AFC Gamma’s specialization allows it to capitalize on opportunities with strong operators, offering attractive risk-adjusted returns.
Moreover, the management’s experience and the company’s robust pipeline of potential deals, amounting to $383 million, further support the Buy rating. The lack of new capital providers entering the market, due to stalled federal cannabis reform, positions AFC Gamma to continue its lending activities effectively. These elements combined suggest that AFC Gamma is well-placed to benefit from the ongoing capital needs of cannabis operators, justifying the Buy recommendation.
According to TipRanks, Elias is a 4-star analyst with an average return of 7.3% and a 41.79% success rate. Elias covers the Real Estate sector, focusing on stocks such as DigitalBridge Group, Digital Realty, and Equinix.
In another report released today, Alliance Global Partners also maintained a Buy rating on the stock with a $10.00 price target.