GICS Sector : Real Estate
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.
Advanced Flower Capital Inc. reported distributable earnings of $0.16 per basic weighted average share of common stock for the quarter ended September 30, 2025, falling short of analyst estimates of $0.19. The company's net interest income was $6,500,000, and distributable earnings were $3,500,000. The Board of Directors declared a third-quarter dividend of $0.15 per common share outstanding, which was paid on October 15, 2025. Notably, the company announced that it will not pay a dividend in the fourth quarter, citing the board's decision.
Publication Date: Nov -21
As of September 30, 2025, Advanced Flower Capital Inc.'s portfolio consisted of $332,800,000 of principal outstanding spread across 14 loans. The CECL reserve was $51,300,000, or approximately 18.7% of their loans at carrying value. The company had a total unrealized loss included on the balance sheet of $31,200,000 for their loans held at fair value. The portfolio's performance was impacted by the challenging market conditions, and the company's efforts to diversify its portfolio are ongoing.
The company's conversion to a BDC is expected to occur in 2026, pending approval from the Board of Directors. This move is anticipated to enable the company to originate and invest in a broader array of opportunities, including both real estate and non-real estate covered assets. The company has already built a pipeline of approximately $350,000,000 in lending opportunities to middle-market companies outside of the cannabis industry, with yields expected to be in the low double-digit range.
Advanced Flower Capital Inc.'s current P/B Ratio is 0.33, and its Dividend Yield is 33.99%. These metrics indicate that the company's stock may be undervalued, considering its book value and dividend payments. However, the company's ROE is -11.94%, and its ROIC is -7.51%, which may raise concerns about its profitability.
The company's management is actively evaluating opportunities to redeploy cash and is looking for stable industries with some element of consistency or recession resistance. While no guidance was given on the timing of redeploying cash, the company's pipeline of $350,000,000 in lending opportunities is expected to drive growth in the coming quarters. Analysts estimate revenue growth to be 3.1% next year, which may be a positive indicator for the company's future performance.
Advanced Flower Capital Inc. (AFCG) Q3 2025 Earnings Call Transcript
Nov -12
Advanced Flower Capital Inc. Announces Financial Results for the Third Quarter 2025
Nov -12
Advanced Flower Capital Shareholders Approve Conversion to Business Development Company
Nov -06
Advanced Flower Capital Schedules Earnings Release and Conference Call for the Third Quarter Ended September 30, 2025
Oct -28
Financial Review: Blackstone Mortgage Trust (NYSE:BXMT) & AFC Gamma (NASDAQ:AFCG)
Oct -26
Advanced Flower Capital Advances Planned Conversion to BDC to Deliver Long-Term Growth and Value Creation
Sep -16
Advanced Flower Capital Announces Dividend for the Third Quarter 2025
Sep -15
Advanced Flower Capital Inc. (AFCG) Q2 2025 Earnings Call Transcript
Aug -14
Growing demand for cannabis, increasing legalization, and limited traditional financing options drive growth in senior secured loans for cannabis businesses, with AFC Gamma's flexible terms and competitive rates positioning it for success.
AFC Gamma provides real estate loans to cannabis companies, allowing them to purchase or refinance properties for their businesses.
AFC Gamma offers equipment financing solutions to cannabis companies, enabling them to acquire the equipment they need to operate efficiently.
AFC Gamma provides working capital loans to cannabis companies, helping them to manage their day-to-day operations and meet their financial obligations.
AFC Gamma offers construction loans to cannabis companies, enabling them to build or renovate facilities to support their growth.
AFC Gamma provides bridge loans to cannabis companies, helping them to overcome short-term financial gaps and achieve their long-term goals.
AFC Gamma, Inc. operates in a highly competitive industry, but the threat of substitutes is mitigated by the company's strong brand recognition and customer loyalty.
AFC Gamma, Inc. has a large customer base, but the bargaining power of customers is high due to the availability of alternative products and services.
AFC Gamma, Inc. has a diversified supplier base, which reduces the bargaining power of suppliers.
The threat of new entrants is moderate due to the high barriers to entry in the industry, but AFC Gamma, Inc. must continue to innovate to stay ahead of potential competitors.
The industry in which AFC Gamma, Inc. operates is highly competitive, with many established players, which increases the intensity of rivalry.
| Value | |
|---|---|
| Debt Weight | 34.96% |
| Debt Cost | 5.28% |
| Equity Weight | 65.04% |
| Equity Cost | 9.33% |
| WACC | 7.92% |
| Leverage | 53.75% |
Value: 5.6
Growth: 4.9
Quality: 8.8
Yield: 9.0
Momentum: 5.0
Volatility: 9.0
1-Year Total Return ->
Value: 6.1
Growth: 9.1
Quality: 4.3
Yield: 10.0
Momentum: 1.0
Volatility: 9.7
1-Year Total Return ->
Value: 3.8
Growth: 5.6
Quality: 5.1
Yield: 9.0
Momentum: 3.5
Volatility: 10.0
1-Year Total Return ->
Value: 8.3
Growth: 7.4
Quality: 5.4
Yield: 10.0
Momentum: 0.0
Volatility: 3.3
1-Year Total Return ->
Value: 6.1
Growth: 3.7
Quality: 4.3
Yield: 0.0
Momentum: 9.0
Volatility: 6.0
1-Year Total Return ->
Value: 5.5
Growth: 4.6
Quality: 5.3
Yield: 5.0
Momentum: 1.5
Volatility: 3.0
1-Year Total Return ->