AFC Gamma (AFCG) AI Stock Analysis

• Market Cap: $127.44M
• Dividend Yield: 16.31%
• Average Volume (3M): 148.93K
• Price to Earnings (P/E): 5.7
• Beta (1Y): 1.02
• Revenue Growth: -28.20%
• EPS Growth: 89.65%
• Country: US
• Employees: N/A
• Sector: Real Estate
• Sector Strength: 63
• Industry: REIT - Specialty
• EPS (TTM): 0.21
• Shares Outstanding: 22,596,006
• 10 Day Avg. Volume: 147,577
• 30 Day Avg. Volume: 148,926
• PEG Ratio: 0.14
• Price to Book (P/B): 0.63
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 6.82
• Enterprise Value/Market Cap: 1.81
• Enterprise Value/Revenue: 1.06
• Enterprise Value/Gross Profit: 6.63
• Enterprise Value/Ebitda: 3.23
• 1Y Price Target: $9.00
• Price Target Upside: 60.14% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4

• Rating: 49 Neutral
• Price Target: $5.50 ▼(-2.14%Downside)

AFCG's score is primarily impacted by weak financial performance due to revenue challenges and increased leverage. Despite undervaluation and strategic credit facility expansion, bearish technical indicators and mixed earnings call sentiment contribute to the moderate score.

Positive Factors

Growth Potential

Management noted that its active pipeline remains strong, highlighting potential deals and opportunities.

Market Opportunities

Management's experience in the industry is positive for winning incremental market opportunity as cannabis operators' capital requirements persist.

Operating Model

Operating as a pure-play cannabis lender is seen as a positive in a market where fewer lenders are present.

Negative Factors

Dividend Reduction

AFCG reported downside results and announced that it is cutting its quarterly dividend due to defaults from legacy loans.

Earnings Decline

Distributable EPS declined to $0.29, which was below estimates and consensus, driven by lower net interest income.

Loan Performance

Approximately 39% of AFCG's loans are on non-accrual status, creating uncertainty in credit recovery.

AFC Gamma Business Overview & Revenue Model

Company Description

AFC Gamma, Inc. originates, structures, underwrites, and invests in senior secured loans, and other types of loans and debt securities for established companies operating in the cannabis industry in states that have legalized medicinal and/or adult use cannabis. It primarily originates loans structured as senior loans secured by real estate, equipment, and licenses and/or other assets of the loan parties to the extent permitted by applicable laws and the regulations governing such loan parties. AFC Gamma, Inc. has elected and qualified to be taxed as a real estate investment trust for the United States federal income tax purposes under the Internal Revenue Code of 1986. The company was incorporated in 2020 and is based in West Palm Beach, Florida.

How the Company Makes Money

AFC Gamma makes money by providing loans to cannabis operators and earning interest income from these loans. As a REIT, AFC Gamma is required to distribute at least 90% of its taxable income to shareholders in the form of dividends, which it generates primarily through interest payments received on its loan portfolio. The company's revenue streams are primarily driven by the interest rates charged on its loans as well as any origination or structuring fees associated with the financing deals. Additionally, AFC Gamma may benefit from strategic partnerships with key players in the cannabis industry, enhancing its ability to source and structure attractive lending opportunities.

AFC Gamma Financial Statement Overview

Summary

AFC Gamma faces significant revenue challenges with no revenue reported in 2024. Profitability was maintained in previous years, but there is a reduction in equity and increased leverage. Cash flow generation is positive but has decreased, highlighting the need to address revenue generation and financial leverage.

Income Statement

AFC Gamma has experienced declining revenue, with a significant drop from $71.54M in 2022 to $66.11M in 2023 and no revenue reported for 2024. Net profit margin improved to 25.39% in 2023 but remains unassessed for 2024 due to no revenue. EBIT and EBITDA margins were stable in prior years but unmeasurable for 2024. This indicates some profitability but significant top-line challenges.

Balance Sheet

The company's balance sheet shows a reduction in stockholders' equity from $339.06M in 2022 to $201.38M in 2024, indicating a downward trend. The debt-to-equity ratio increased from 0.46 in 2022 to 0.44 in 2024, suggesting increased leverage. The equity ratio declined, reflecting a decrease in the proportion of equity financed by total assets.

Cash Flow

Operating cash flow has decreased from $31.32M in 2022 to $18.29M in 2024, and free cash flow followed a similar trend. Free cash flow to net income ratio indicates adequate cash generation relative to reported profits in 2023. This suggests some operational cash flow challenges despite maintaining positive free cash flow.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
40.85M	35.76M	66.11M	71.54M	38.08M	5.60M
	Gross Profit
34.75M	35.76M	52.04M	60.36M	35.43M	5.23M
	EBIT
24.11M	13.86M	26.98M	43.77M	21.04M	4.78M
	EBITDA
18.52M	20.65M	26.98M	43.77M	22.16M	0.00
	Net Income Common Stockholders
20.91M	16.78M	20.95M	35.93M	21.00M	4.31M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
3.32M	103.61M	121.63M	140.37M	125.13M	9.62M
	Total Assets
321.66M	402.06M	466.59M	519.18M	464.85M	93.96M
	Total Debt
88.76M	188.61M	130.01M	157.13M	171.42M	48.63M
	Net Debt
85.44M	85.00M	39.63M	16.76M	62.17M	39.01M
	Total Liabilities
120.85M	200.68M	146.53M	180.12M	191.77M	1.54M
	Stockholders Equity
200.80M	201.38M	320.05M	339.06M	273.08M	91.65M
Cash Flow		Free Cash Flow
19.11M	21.56M	21.23M	31.32M	9.54M	1.52M
	Operating Cash Flow
19.11M	21.56M	21.23M	31.32M	9.54M	1.52M
	Investing Cash Flow
29.95M	-4.85M	28.52M	-16.34M	-248.46M	-32.43M
	Financing Cash Flow
-128.04M	-34.72M	-68.49M	16.15M	338.54M	40.53M

AFC Gamma Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 5.62
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AFCG, the sentiment is Neutral. The current price of 5.62 is above the 20-day moving average (MA) of 5.20, above the 50-day MA of 5.25, and below the 200-day MA of 7.67, indicating a neutral trend. The MACD of 0.04 indicates Negative momentum. The RSI at 59.53 is Neutral, neither overbought nor oversold. The STOCH value of 90.16 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AFCG.

AFC Gamma Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FPI	73 Outperform	$551.69M	11.43	12.09%	2.05%	-0.52%	112.78%
Sector *	61 Neutral	$2.86B	10.96	0.41%	6.08%	5.73%	-21.25%
AFCG	49 Neutral	$127.44M	5.72	8.11%	16.31%	-28.20%	89.65%
PW		$3.97M	―	-139.84%	―	―	―

AFC Gamma Corporate Events

AFC Gamma Expands Credit Facility to $50 Million

On June 9, 2025, Advanced Flower Capital Inc. announced an expansion of its senior secured revolving credit facility to $50 million, with an additional $20 million commitment from its existing FDIC-insured banking partner. This expansion aims to fund commitments to existing borrowers, originate and participate in commercial loans to cannabis operators, and support general corporate purposes. The facility can be further expanded to $100 million, subject to lender participation. This move underscores the strength of AFC’s platform and strategy, as highlighted by CFO Brandon Hetzel, and is expected to enhance the company’s lending capabilities and strengthen its partnership with the banking partner.

The most recent analyst rating on (AFCG) stock is a Buy with a $13.00 price target. To see the full list of analyst forecasts on AFC Gamma stock, see the AFCG Stock Forecast page.

AFC Gamma Holds 2025 Annual Shareholders Meeting

On May 19, 2025, Advanced Flower Capital Inc. held its 2025 Annual Meeting of Shareholders. During the meeting, shareholders voted on the reelection of a director and the ratification of CohnReznick LLP as the independent registered public accounting firm for 2025. The reelection of the Class II director nominee was approved, extending their term until the 2028 Annual Meeting. Additionally, the appointment of CohnReznick LLP was ratified, securing their role in overseeing the company’s financial audits for the year.

The most recent analyst rating on (AFCG) stock is a Buy with a $13.00 price target. To see the full list of analyst forecasts on AFC Gamma stock, see the AFCG Stock Forecast page.