Jade Rahmani, an analyst from KBW, maintained the Buy rating on Blackstone Mortgage. The associated price target was raised to $21.00.
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Jade Rahmani has given his Buy rating due to a combination of factors that indicate a positive outlook for Blackstone Mortgage Trust. The company has already absorbed most of its credit losses prior to the anticipated bottom of the commercial real estate market in 2024, and its portfolio credit trends are showing signs of stabilization and improvement. This is coupled with strategic optionality around key exposures and an increase in investments, which are expected to drive future growth.
Moreover, recent discussions with management and insights from KBW’s CRE Day and third-quarter earnings reveal a confident stance towards ongoing recovery in the commercial real estate sector. The company has made strategic investments, including an accretive bank-loan acquisition, and is poised for strong originations in the fourth quarter. With a favorable debt environment and expectations for distributable earnings per share to surpass dividends by the first quarter of 2026, BXMT is well-positioned for potential dividend growth in the latter half of 2026. Valuing the company at historical spreads suggests a 22% return, with further upside potential from additional growth opportunities.