AFC Gamma (AFCG) AI Stock Analysis

• Market Cap: $106.20M
• Dividend Yield: 22.13%
• Average Volume (3M): 214.73K
• Price to Earnings (P/E): 4.8
• Beta (1Y): 1.04
• Revenue Growth: -28.20%
• EPS Growth: 89.65%
• Country: US
• Employees: N/A
• Sector: Real Estate
• Sector Strength: 55
• Industry: REIT - Specialty
• EPS (TTM): 0.21
• Shares Outstanding: 22,596,006
• 10 Day Avg. Volume: 222,053
• 30 Day Avg. Volume: 214,731
• 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: 2.17
• Enterprise Value/Revenue: 1.06
• Enterprise Value/Gross Profit: 6.63
• Enterprise Value/Ebitda: 3.23
• 1Y Price Target: $10.00
• Price Target Upside: 112.77% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 52 Neutral
• Price Target: $4.50 ▼(-4.26%Downside)

AFC Gamma's stock score is primarily influenced by its financial performance challenges, including no revenue in 2024 and a weakened balance sheet. Technical indicators also suggest a bearish trend. However, the stock's valuation appears favorable, with a low P/E ratio and high dividend yield. Recent corporate events and earnings call insights provide some positive outlooks, although significant risks remain.

Positive Factors

Management Experience

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

Market Position

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

Potential Opportunities

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

Negative Factors

Credit Risk

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

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.

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 primarily through the interest and fees generated from the loans it provides to cannabis businesses. As a REIT, AFC Gamma is required to distribute at least 90% of its taxable income to shareholders in the form of dividends, which are funded by the income generated from its lending activities. The company strategically partners with cannabis operators to offer secured loans, often collateralized by real estate or other valuable assets, thus ensuring a steady revenue stream. Additionally, AFC Gamma may also earn income from equity investments or warrants in the companies it finances, further diversifying its revenue base.

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
EBITDA	18.52M	20.65M	26.98M	43.77M	22.16M	0.00
Net Income	20.91M	16.78M	20.95M	35.93M	21.00M	4.31M
Balance Sheet
Total Assets	321.66M	402.06M	466.59M	519.18M	464.85M	93.96M
Cash, Cash Equivalents and Short-Term Investments	3.32M	103.61M	121.63M	140.37M	125.13M	9.62M
Total Debt	88.76M	188.61M	130.01M	157.13M	171.42M	48.63M
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: Negative
• Last Price: 4.70
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AFCG, the sentiment is Negative. The current price of 4.7 is below the 20-day moving average (MA) of 4.78, below the 50-day MA of 4.98, and below the 200-day MA of 7.10, indicating a bearish trend. The MACD of -0.12 indicates Negative momentum. The RSI at 47.57 is Neutral, neither overbought nor oversold. The STOCH value of 49.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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	$533.02M	11.33	12.09%	2.07%	-0.52%	112.78%
Sector *	64 Neutral	$7.01B	18.92	-1.36%	6.84%	4.67%	-25.39%
AFCG	52 Neutral	$106.20M	4.77	8.11%	22.13%	-28.20%	89.65%
PW		$3.87M	―	-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.