Analyzing AFC Gamma (NASDAQ:AFCG) and KKR & Co. Inc. (NYSE:KKR)

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

Valuation & Earnings

This table compares KKR & Co. Inc. and AFC Gamma”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
KKR & Co. Inc.	$20.10 billion	4.50	$2.37 billion	$3.43	29.36
AFC Gamma	$31.32 million	2.50	-$20.67 million	$1.04	3.36

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

Institutional and Insider Ownership

76.3% of KKR & Co. Inc. shares are owned by institutional investors. Comparatively, 26.5% of AFC Gamma shares are owned by institutional investors. 23.2% of KKR & Co. Inc. shares are owned by insiders. Comparatively, 30.7% of AFC Gamma shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares KKR & Co. Inc. and AFC Gamma’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
KKR & Co. Inc.	16.38%	6.31%	1.16%
AFC Gamma	71.50%	4.57%	2.31%

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for KKR & Co. Inc. and AFC Gamma, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
KKR & Co. Inc.	0	4	17	0	2.81
AFC Gamma	1	1	0	0	1.50

KKR & Co. Inc. presently has a consensus price target of $123.11, indicating a potential upside of 22.24%. Given KKR & Co. Inc.’s stronger consensus rating and higher probable upside, research analysts plainly believe KKR & Co. Inc. is more favorable than AFC Gamma.

Dividends

KKR & Co. Inc. pays an annual dividend of $0.78 per share and has a dividend yield of 0.8%. AFC Gamma pays an annual dividend of $0.20 per share and has a dividend yield of 5.7%. KKR & Co. Inc. pays out 22.7% of its earnings in the form of a dividend. AFC Gamma pays out 19.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. KKR & Co. Inc. has raised its dividend for 5 consecutive years. AFC Gamma is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

KKR & Co. Inc. has a beta of 1.72, suggesting that its share price is 72% more volatile than the S&P 500. Comparatively, AFC Gamma has a beta of 1, suggesting that its share price has a similar volatility profile to the S&P 500.

Summary

KKR & Co. Inc. beats AFC Gamma on 12 of the 17 factors compared between the two stocks.

About KKR & Co. Inc.

KKR & Co. Inc. is a global investment firm that manages alternative investment funds and other investment products. Its activities include private equity, credit, infrastructure and real estate investing, as well as insurance through its Global Atlantic business. The firm also provides capital markets services, including financing and strategic solutions for companies and other clients. KKR invests across multiple industries and serves clients and investors in markets around the world. Founded in 1976 by Henry Kravis, George Roberts and Jerome Kohlberg, KKR is led by co-chief executive officers Joseph Bae and Scott Nuttall.

About AFC Gamma

AFC Gamma, Inc. is a specialty finance company focused primarily on providing institutional debt financing to businesses operating in the regulated cannabis industry. The company has historically targeted established cannabis operators and other participants in the industry that may have limited access to traditional bank financing. Its financing activities have included senior secured loans, mortgage-backed loans and other structured debt arrangements. Borrowers may use these funds to support the acquisition, development or expansion of cannabis cultivation, processing, manufacturing and retail facilities, as well as related working-capital and corporate needs.