FBR Capital Reiterates a Buy Rating on Colony Starwood Homes

By Carrie Williams

In a report released today, David Corak from FBR Capital reiterated a Buy rating on Colony Starwood Homes (NYSE: SFR), with a price target of $37. The company’s shares opened today at $29.16.

Corak said:

“The company posted a solid quarter, in our opinion, checking most of the boxes that we were hoping it would check. In addition to a beat and raise quarter, the company substantially exited the NPL business, continued to recycle the portfolio with $83 million of REO and SFR homes, acquired 431 homes for $112 million, and closed a $580.7 million securitization subsequent to quarter-end. Rate growth for both new lease and renewals is now largely outpacing the multifamily REITs peers. The external growth profile continues to improve with the recovery of the stock price, as the company is deploying capital into growing the asset base rather than repurchasing shares. We believe today’s valuation levels paired with sector and company specific tailwinds create significant upside to the share price.”

According to TipRanks.com, Corak is a 2-star analyst with an average return of 0.9% and a 44.0% success rate. Corak covers the Financial sector, focusing on stocks such as National Storage Affiliates Trust, Preferred Apartment Communities, and Bluerock Residential Growth.

Currently, the analyst consensus on Colony Starwood Homes is Strong Buy and the average price target is $36.50, representing a 25.2% upside.

In a report released today, JMP Securities also reiterated a Buy rating on the stock.

Based on Colony Starwood Homes’ latest earnings report from June 30, the company posted quarterly revenue of $143.8M and quarterly net profit of -$15.68M. In comparison, last year the company earned revenue of $86.29M and had a net profit of -$11.16M.

Colony Starwood Homes is a real estate investment trust. The fund invests in renovates, leases and manages residential assets in select markets throughout the U.S. Its strategy is to acquire single-family homes, or homes, through a variety of channels, renovate these homes to the extent necessary and lease them to qualified residents.