Overview

* Advanced Flower Capital ( AFCG ) Q2 GAAP net loss of $13.2 mln, reflecting cannabis market challenges

* Distributable Earnings of $3.4 mln missed analyst expectations, per LSEG data

* Co plans to convert from mortgage REIT to BDC, expanding investment opportunities

Outlook

* Company plans to convert from REIT to BDC, pending shareholder approval

* Company aims to expand investment opportunities beyond real estate assets

* Company sees potential in lending to ancillary cannabis businesses

* Company expects broader investment mandate to diversify exposure

Result Drivers

* NON-ACCRUAL CREDITS - Focus on resolving non-accrual credits impacted financial results, per CEO Dan Neville

* LACK OF CAPITAL - Continued lack of capital in cannabis market affecting operations, according to CEO

* EXPANDED MANDATE - Expansion of investment mandate to include non-cannabis middle market companies

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q2 Miss $3.40 $4.89

Distribu mln mln (6

table Analysts

Earnings )

Q2 Net -$13.20

Income mln

Q2 $0.15

Dividend

Analyst Coverage

* The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"

* The average consensus recommendation for the specialized reits peer group is "buy"

* Wall Street's median 12-month price target for Advanced Flower Capital Inc ( AFCG ) is $10.00, about 54.4% above its August 13 closing price of $4.56

* The stock recently traded at 4 times the next 12-month earnings vs. a P/E of 5 three months ago

Press Release:

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)