AFC Gamma (NASDAQ:AFCG) vs. AGNC Investment (NASDAQ:AGNC) Head to Head Review

AFC Gamma (NASDAQ:AFCG) and AGNC Investment (NASDAQ:AGNC) are both finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, dividends, valuation, institutional ownership, earnings, profitability and risk.

Insider and Institutional Ownership

26.5% of AFC Gamma shares are owned by institutional investors. Comparatively, 38.3% of AGNC Investment shares are owned by institutional investors. 30.7% of AFC Gamma shares are owned by company insiders. Comparatively, 0.4% of AGNC Investment shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Risk and Volatility

AFC Gamma has a beta of 0.87, meaning that its stock price is 13% less volatile than the S&P 500. Comparatively, AGNC Investment has a beta of 1.32, meaning that its stock price is 32% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for AFC Gamma and AGNC Investment, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AFC Gamma	1	2	0	0	1.67
AGNC Investment	0	6	4	0	2.40

AFC Gamma presently has a consensus target price of $4.50, suggesting a potential upside of 38.89%. AGNC Investment has a consensus target price of $11.06, suggesting a potential upside of 0.57%. Given AFC Gamma’s higher possible upside, equities analysts plainly believe AFC Gamma is more favorable than AGNC Investment.

Profitability

This table compares AFC Gamma and AGNC Investment’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
AFC Gamma	-43.21%	1.48%	0.85%
AGNC Investment	39.50%	18.31%	1.60%

Dividends

AFC Gamma pays an annual dividend of $0.20 per share and has a dividend yield of 6.2%. AGNC Investment pays an annual dividend of $1.44 per share and has a dividend yield of 13.1%. AFC Gamma pays out -31.3% of its earnings in the form of a dividend. AGNC Investment pays out 119.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation and Earnings

This table compares AFC Gamma and AGNC Investment”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AFC Gamma	$31.32 million	2.43	-$20.67 million	($0.64)	-5.06
AGNC Investment	$3.52 billion	3.58	$1.67 billion	$1.21	9.09

AGNC Investment has higher revenue and earnings than AFC Gamma. AFC Gamma is trading at a lower price-to-earnings ratio than AGNC Investment, indicating that it is currently the more affordable of the two stocks.

Summary

AGNC Investment beats AFC Gamma on 13 of the 16 factors compared between the two stocks.

About AFC Gamma

AFC Gamma, Inc. originates, structures, underwrites, and invests in senior secured loans, and other various commercial real estate loans and debt securities for established companies operating in the cannabis industry. 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. The company 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. AFC Gamma, Inc. was incorporated in 2020 and is based in West Palm Beach, Florida.

About AGNC Investment

AGNC Investment Corp., formerly American Capital Agency Corp., is a real estate investment trust. The Company invests in agency residential mortgage-backed securities on a leveraged basis. Its investments consist of residential mortgage pass-through securities and collateralized mortgage obligations (CMOs) for which the principal and interest payments are guaranteed by a government-sponsored enterprise, such as the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac), or by the United States Government agency, such as the Government National Mortgage Association (Ginnie Mae) (collectively, GSEs). Its agency securities include agency residential mortgage-backed securities (Agency RMBS) and to-be-announced forward contracts (TBAs). Its Non-Agency Securities include credit risk transfer securities (CRT), non-agency residential mortgage-backed securities (Non-Agency RMBS) and commercial mortgage-backed securities (CMBS).