Comparing DigitalBridge Group (NYSE:DBRG) & AFC Gamma (NASDAQ:AFCG)

AFC Gamma (NASDAQ:AFCG) and DigitalBridge Group (NYSE:DBRG) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, valuation, profitability, risk, dividends, earnings and institutional ownership.

Risk & Volatility

AFC Gamma has a beta of 1.02, meaning that its share price is 2% more volatile than the S&P 500. Comparatively, DigitalBridge Group has a beta of 1.67, meaning that its share price is 67% more volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
AFC Gamma	-70.17%	0.99%	0.62%
DigitalBridge Group	N/A	5.51%	2.64%

Institutional & Insider Ownership

26.5% of AFC Gamma shares are held by institutional investors. Comparatively, 92.7% of DigitalBridge Group shares are held by institutional investors. 25.1% of AFC Gamma shares are held by company insiders. Comparatively, 3.6% of DigitalBridge Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and price targets for AFC Gamma and DigitalBridge Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AFC Gamma	2	1	0	0	1.33
DigitalBridge Group	1	7	1	0	2.00

AFC Gamma presently has a consensus target price of $4.50, indicating a potential upside of 64.23%. DigitalBridge Group has a consensus target price of $16.00, indicating a potential upside of 3.96%. Given AFC Gamma’s higher possible upside, analysts plainly believe AFC Gamma is more favorable than DigitalBridge Group.

Valuation & Earnings

This table compares AFC Gamma and DigitalBridge Group”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	2.06	-$20.67 million	($0.95)	-2.88
DigitalBridge Group	$374.45 million	7.51	$141.87 million	$0.45	34.20

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

Dividends

AFC Gamma pays an annual dividend of $0.53 per share and has a dividend yield of 19.3%. DigitalBridge Group pays an annual dividend of $0.04 per share and has a dividend yield of 0.3%. AFC Gamma pays out -55.8% of its earnings in the form of a dividend. DigitalBridge Group pays out 8.9% 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. AFC Gamma is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

DigitalBridge Group beats AFC Gamma on 12 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 DigitalBridge Group

DigitalBridge is an infrastructure investment firm specializing in digital infrastructure assets. They provide services to institutional investors. They primarily invest in data centers, cell towers, fiber networks, small cells, and edge infrastructure. DigitalBridge Group, Inc. was founded in 1991 and is headquartered in Boca Raton, Florida with additional offices in Los Angles, California, and New York New York.