AFC Gamma: An Interesting Speculation With A 13.1% Yield

Oct. 30, 2022 10:00 AM ETAFC Gamma, Inc. (AFCG)IIPR, NLCP, REFI16 Comments
BeanKounter Capital profile picture
BeanKounter Capital
4.64K Followers

Summary

  • AFCG is a small cap mortgage REIT focused on lending to businesses in the cannabis industry.
  • This might be a turn-off for some, but the complexity allows AFCG to get double-digit yields on their loan portfolio.
  • The external management is another thing to be aware of, but the insider ownership is high.
  • The company focuses on limited license jurisdictions to help reduce their risk.
  • Shares trade near book value, and I think the risk/reward is skewed to the upside.

Residential real estate loan, financial concept : House model, coins, US dollar bag, white clock on a table, depicts home loan or borrowing money to buy / purchase a new home for first time homebuyer

William_Potter

It's been a while since I wrote an article on AFC Gamma (NASDAQ:AFCG). Since May, shares have basically chopped sideways (while paying out two $0.56 quarterly dividends), but I figured it was high time that I wrote an update on this cannabis

AFCG Loan Map

Loan Portfolio Map (afcgamma.com)

This article was written by

BeanKounter Capital profile picture
4.64K Followers
CPA and former Big 4 auditor. I break down investments in qualitative and quantitative terms, and I look for investments that will compound my money over the long term.

Disclosure: I/we have a beneficial long position in the shares of AFCG, IIPR, NLCP, REFI either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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