Starwood Property Trust Receives a Buy from B.Riley FBR

By Jason Carr

B.Riley FBR analyst Jessica Levi-Ribner reiterated a Buy rating on Starwood Property Trust (NYSE: STWD) today and set a price target of $24. The company’s shares closed yesterday at $20.99, close to its 52-week low of $20.78.

Levi-Ribner wrote:

“We reiterate our Buy rating and $24 price target on shares of Starwood Property Trust (STWD) following the announcement of a $500 million unsecured senior notes offering (due Jan 2021), which carry a coupon of 3.625%. The proceeds of the offering will be used to pay the outstanding ~$370 million of 4.55% convertible senior notes due March 2018 and a portion of outstanding repurchase agreements. Overall, we view this transaction as a positive for shares of STWD as it extends the duration of the company’s liabilities, has a modestly accretive impact to core earnings, and is essentially leverage neutral. Along with the notes offering, Starwood announced that it expects to incur a $10 million write-down of its deferred tax asset reflecting the year-end tax legislation. As such, we adjust our core EPS estimate from $0.50 to $0.47, but note that our core EPS estimate ex-DTA is slightly higher at $0.51, reflecting modest adjustments.”

According to, Levi-Ribner is a 4-star analyst with an average return of 7.2% and a 75.2% success rate. Levi-Ribner covers the Financial sector, focusing on stocks such as Sutherland Asset Management Corporation, Arlington Asset Investment, and New York Mortgage Trust.

Starwood Property Trust has an analyst consensus of Moderate Buy, with a price target consensus of $24.

Starwood Property Trust’s market cap is currently $5.47B and has a P/E ratio of 12.72. The company has a book value ratio of 1.2174.

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Starwood Property Trust, Inc. engages in originating, acquiring, financing, and managing commercial mortgage loans and other commercial real estate debt and equity investments. It operates through the following segments: Real Estate Lending; Real Estate Investing and Servicing, and Real Estate Property.