KKR Real Estate Finance Trust (NYSE: KREF) and Blackstone Mortgage Trust (NYSE:BXMT) are both financials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, earnings, valuation, profitability, analyst recommendations and risk.
Institutional & Insider Ownership
70.7% of KKR Real Estate Finance Trust shares are held by institutional investors. Comparatively, 54.4% of Blackstone Mortgage Trust shares are held by institutional investors. 0.9% of Blackstone Mortgage Trust shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This table compares KKR Real Estate Finance Trust and Blackstone Mortgage Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|KKR Real Estate Finance Trust||77.41%||6.08%||0.75%|
|Blackstone Mortgage Trust||53.86%||8.47%||2.28%|
KKR Real Estate Finance Trust pays an annual dividend of $1.48 per share and has a dividend yield of 7.5%. Blackstone Mortgage Trust pays an annual dividend of $2.48 per share and has a dividend yield of 7.9%. KKR Real Estate Finance Trust pays out 142.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Blackstone Mortgage Trust pays out 109.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Blackstone Mortgage Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.
Earnings and Valuation
This table compares KKR Real Estate Finance Trust and Blackstone Mortgage Trust’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|KKR Real Estate Finance Trust||$41.19 million||25.68||$31.15 million||$1.04||18.94|
|Blackstone Mortgage Trust||$303.05 million||11.16||$217.63 million||$2.27||13.78|
Blackstone Mortgage Trust has higher revenue and earnings than KKR Real Estate Finance Trust. Blackstone Mortgage Trust is trading at a lower price-to-earnings ratio than KKR Real Estate Finance Trust, indicating that it is currently the more affordable of the two stocks.
This is a summary of current ratings and target prices for KKR Real Estate Finance Trust and Blackstone Mortgage Trust, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|KKR Real Estate Finance Trust||1||2||1||0||2.00|
|Blackstone Mortgage Trust||0||2||4||0||2.67|
KKR Real Estate Finance Trust presently has a consensus price target of $22.50, suggesting a potential upside of 14.21%. Blackstone Mortgage Trust has a consensus price target of $33.25, suggesting a potential upside of 6.33%. Given KKR Real Estate Finance Trust’s higher possible upside, equities research analysts clearly believe KKR Real Estate Finance Trust is more favorable than Blackstone Mortgage Trust.
Blackstone Mortgage Trust beats KKR Real Estate Finance Trust on 10 of the 15 factors compared between the two stocks.
About KKR Real Estate Finance Trust
KKR Real Estate Finance Trust Inc is a real estate finance company that focuses primarily on originating and acquiring senior mortgage loans secured by commercial real estate assets (CRE). KKR manages investments across multiple asset classes, including private equity, real estate, energy, infrastructure, credit and hedge funds. The Company’s investment strategy is to originate or acquire senior mortgage loans collateralized by institutional-quality CRE assets. Its target assets also include mezzanine loans, preferred equity and other debt-oriented instruments. The Company’s investment objective is capital preservation and generating attractive risk-adjusted returns for its stockholders over the long term, primarily through dividends.
About Blackstone Mortgage Trust
Blackstone Mortgage Trust, Inc. is a holding company. The Company conducts its operations as a real estate investment trust for the United States federal income tax purposes. The Company originates and purchases senior loans collateralized by properties in North America and Europe. The Company’s business is focused on originating or acquiring senior, floating rate mortgage loans that are secured by a first priority mortgage on commercial real estate assets primarily in the office, lodging, retail, residential and industrial sectors. These investments may be in the form of whole loans or may also include pari passu participations within mortgage loans. It directly originates, co-originates and acquires debt instruments in conjunction with acquisitions, refinancings and recapitalizations of commercial real estate. The Company’s manager is BXMT Advisors L.L.C.
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