Analysts Upgrade Estimates for Commercial Mortgage REITs

Mortgage & Real Estate

Keefe, Bruyette Woods analysts increased third-quarter earnings estimates for Blackstone Mortgage Trust, Starwood Property Trust and Colony Financial to outperform. Ratings on Apollo Commercial Real Estate also remain favorable.

Blackstone Mortgage Trust leads the pack with estimates due to higher originations and dividend.

In addition to estimated loan closings of $735 million, higher-than-expected dividends (at $0.27 up from $0.21) suggest earnings greater than our previous forecast, analysts wrote.

Total originations of $2 billion to date are driving the increase in the 2013-2014 estimates to $1 and $2.02 from $0.82 from $1.97, respectively, according to the report.

Analysts modestly reduced estimates of Starwood Property Trusts third-quarter results based on recent equity increases, but also noted that earnings will benefit from expected higher occupancy.

Even though the equity raise is partly offset by increased originations, analysts lowered third- and fourth-quarter estimates. As a result the new forecast for third-quarter originations is $1.2 billion, down from $750 million.

Leave a Reply