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Ladder Capital (LADR)
NYSE:LADR
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Ladder Capital
(NYSE:LADR)
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Rating:54Neutral
Price Target:
$10.50
▲(7.47% Upside)
Action:ReiteratedDate:02/09/26
The score is held back primarily by weakening recent financial trends and elevated leverage, alongside bearish technicals (below key moving averages with negative MACD). Offsetting these are a positive earnings-call outlook with improved funding profile and origination momentum, plus an attractive ~9% dividend yield.
Positive Factors
Investment-grade ratings
Achieving investment-grade ratings materially lowers Ladder's long-term cost of unsecured funding and broadens institutional investor access. This structural credit improvement reduces refinancing risk, strengthens capital market access for bond issuance, and supports durable funding stability for loan growth.
Improved capital structure & liquidity
A predominantly unsecured liability mix, large undrawn revolver capacity and significant unencumbered assets create lasting funding optionality. This structural liquidity buffer reduces rollover risk, enables disciplined originations, and supports maintaining conservative adjusted leverage near targeted levels.
Originations momentum and pipeline
Sustained originations and a sizable application pipeline replenish yield-bearing assets and underpin future net interest income. Durable origination momentum is critical for achieving targeted high-single-digit ROE and shifts the business mix back toward higher-yield loans rather than low-yield securities.
Negative Factors
High leverage
Leverage near sector norms still amplifies downside: high debt levels make earnings, book value, and dividend sustainability sensitive to credit losses, NII swings, or rising funding costs. Elevated leverage constrains flexibility to absorb shocks and slows recovery from adverse cycles.
Weakening revenue and cash generation
A sharp decline in revenue and operating cash flow signals weakening core cash generation, reducing internal funding for originations and lowering buffers for credit losses or dividend support. Sustained recovery in top-line and OCF is required to restore durable financial resilience.
Credit strain and office exposure
Nonaccrual balances and residual office exposure create persistent credit risk that can produce prolonged workouts, reserve build, and lower realized yields. These structural asset-quality issues constrain underwriting flexibility and slow durable improvement in ROE despite better funding.
Ladder Capital (LADR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.24B
Dividend Yield8.21%
Average Volume (3M)690.33K
Price to Earnings (P/E)21.5
Beta (1Y)0.43
Revenue Growth-17.18%
EPS Growth-17.16%
CountryUS
Employees54
SectorReal Estate
Sector Strength53
IndustryREIT - Mortgage
Share Statistics
EPS (TTM)0.17
Shares Outstanding127,233,560
10 Day Avg. Volume933,644
30 Day Avg. Volume690,326
Financial Highlights & Ratios
PEG Ratio-0.53
Price to Book (P/B)0.93
Price to Sales (P/S)3.52
P/FCF Ratio15.85
Enterprise Value/Market Cap3.79
Enterprise Value/Revenue12.14
Enterprise Value/Gross Profit16.98
Enterprise Value/Ebitda17.13
Forecast
1Y Price Target
$12.17Price Target Upside24.56% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)1.06
Revenue Forecast (FY)$237.40M
Ladder Capital Business Overview & Revenue Model
Company DescriptionThe Loans segment originates conduit first mortgage loans that are secured by cash-flowing commercial real estate; and originates and invests in balance sheet first mortgage loans secured by commercial real estate properties that are undergoing transition, including lease-up, sell-out, and renovation or repositioning. It also invests in note purchase financings, subordinated debt, mezzanine debt, and other structured finance products related to commercial real estate. The Securities segment invests in commercial mortgage-backed securities and the U.S. Agency Securities. This segment also invests in corporate bonds and equity securities. The Real Estate segment owns and invests in a portfolio of commercial and residential real estate properties, such as leased properties, office buildings, student housing portfolios, hotels, industrial buildings, shopping center, and condominium units. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. Ladder Capital Corp was founded in 2008 and is headquartered in New York, New York.
How the Company Makes MoneyLadder Capital generates revenue through several key streams. The primary source is the interest income from its loan portfolio, which includes first mortgage loans and subordinated debt. The company also earns fees from loan origination and servicing, as well as income from its investments in CMBS and other real estate securities. Additionally, Ladder Capital may engage in the sale of real estate assets or properties held in its portfolio, contributing to its earnings. The company’s financial performance is further supported by strategic partnerships with various financial institutions and real estate developers, enhancing its ability to identify and execute profitable investment opportunities.
Ladder Capital Earnings Call Summary
Earnings Call Date:Feb 05, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 23, 2026
Earnings Call Sentiment Positive
Overall the call emphasized a strong, constructive narrative: Ladder achieved investment-grade ratings, improved access to unsecured capital, demonstrated meaningful loan origination momentum and high-quality securities positioning, and maintained conservative leverage and liquidity. Management acknowledged isolated credit issues (a $5 million realized loss, four nonaccruals totaling ~2.5% of assets) and near-term timing pressures on net interest income, but positioned these as manageable within a solid balance sheet and growing loan pipeline. Given the breadth and materiality of positive developments (ratings, funding, origination growth, liquidity, high-quality securities) relative to contained credit and timing headwinds, the tone and facts point to a predominantly positive outlook heading into 2026.Q4-2025 Updates
Positive Updates
Investment-Grade Ratings Achieved
In 2025 Ladder obtained investment-grade ratings from Moody's (BAA3) and Fitch (BBB-); S&P upgraded the company to BB+ in January. Management emphasized this as a key milestone that lowers cost of funds and broadens access to stable capital markets.
Strong Distributable Earnings and ROE
Q4 distributable earnings of $21.4 million ($0.17/share); adjusted for a previously reserved $5 million realized loan loss, Q4 earnings were $26.4 million ($0.21/share). Full-year distributable earnings were $109.9 million with a reported return on equity of 7.1%.
Record Loan Originations and Accelerating Pipeline
Originated $1.4 billion in new loans in 2025 (highest annual volume since 2021). H2 2025 originations were nearly $950 million. Q4 included more than $430 million in new loans at a weighted average spread of 340 basis points. Early 2026 momentum: over $250 million closed and more than $450 million under application/in closing.
Loan Portfolio Size and Yield
Year-end loan portfolio totaled $2.2 billion (42% of total assets) with a weighted average loan yield of 7.8%.
High-Quality Securities Portfolio
Securities portfolio increased to $2.1 billion (39% of total assets), up over 90% following reallocation from T-bills. Portfolio yield 5.3%; 99% investment-grade and 97% AAA. Approximately 66% ($1.4 billion) of securities remain unencumbered.
Improved Capital Structure and Liquidity
Issued inaugural $500 million unsecured investment-grade bond at 5.5% (167 bps over treasuries at issuance); secondary trading tightened to ~100 bps (tightened >60 bps). Unsecured $850 million revolver with accordion to $1.25 billion; recently secured $100 million additional commitments toward accordion. Total liquidity $608 million, including $570 million undrawn revolver capacity. 71% of debt unsecured and 81% of assets unencumbered.
Asset Growth and Balance Sheet Metrics
Assets increased 16% in 2025 and 10% in Q4. Adjusted leverage reported at 2.0x. Undepreciated book value per share $13.69 (net of $0.37/share CECL reserve). CECL reserve stands at $47 million (0.37/share).
Real Estate Segment Performance
Real estate portfolio (~$966 million) delivered stable net operating income of $14.8 million in Q4 and $57.3 million for the full year; net-lease segment (~$66 million) continued to generate stable NOI with long-term leases (average lease term ~6.7 years).
Capital Return Actions
Repurchased $10.2 million of common stock in 2025 (965,000 shares at weighted avg $10.60); $90.6 million remains available under repurchase program. Declared a $0.23/share dividend in Q4 (paid Jan 15, 2026); full-year dividend coverage was ~96% excluding the loan write-off.
Asset Allocation Execution and Funding Strategy
Management successfully reallocated cash/T-bills into AAA securities and is positioned to deploy proceeds and unsecured capital to fund loan growth, reflecting a deliberate shift back to lending with a predominantly unsecured liability structure.
Negative Updates
Realized Loan Loss and Nonaccruals
Recorded a $5 million realized loan loss in Q4 (which was previously reserved). At year-end four loans totaling $129.7 million (2.5% of total assets) were on nonaccrual; one nonaccrual (Weatherly Building, Portland) added in Q4. Management noted one subsequent foreclosure/resolution of a $61 million carrying value loan.
Net Interest Income Pressure in Quarter
Quarter-over-quarter net interest income dipped (interest income ~$3.5 million lower), driven by lower SOFR in recent months and timing effects (many loans funded late in December reduced Q4 NII recognition). Management expects pickup in subsequent quarters.
Office Exposure and Select Credit Strains
Office loan exposure remains present at 11% of total assets (down from 14%). The company acknowledged small losses or workout situations in certain markets (Wilmington, Portland, Minneapolis, San Francisco) and cautioned that some office loans remain challenged.
Historic Payoff Volatility
Large payoffs over the last two years (approximately $1.7 billion in 2024 and $608 million in 2025) previously pressured loan growth and NII. While payoffs slowed (only $107 million in one quarter), prior payoff volatility created timing headwinds to earnings visibility.
Competitive Dynamics Returning
Regional banks and other competitors are re-entering lending markets, particularly in construction and conduit spaces, which could pressure spreads and competition for certain loan types as 2026 progresses.
Management Acknowledges Past Underwriting Shortcomings
Management stated industry losses were driven by prior low-cap-rate underwriting environments and rising rates; while Ladder's losses were modest versus peers, executives admitted losses were 'unacceptably high' relative to their models and outlined tighter underwriting discipline going forward.
One Large Application Fell Out
During the quarter a $200 million loan fell out of application, illustrating the potential for pipeline volatility even amid strong originations.
Company Guidance
On the call Ladder guided toward a 2026 strategy focused on driving earnings growth by increasing loan originations (having closed over $250M so far in 2026 with >$450M under application) and growing the asset base to “a little over $6B” by year-end, targeting a return on equity in the high single digits (roughly 9–10%) while keeping adjusted leverage around 2.0x (and a conservative 2–3x target), maintaining a predominantly unsecured capital structure (71% unsecured debt, 81% unencumbered assets), and preserving strong liquidity ($608M total, incl. $570M undrawn revolver and $100M committed accordion toward a $1.25B revolver). Key 2025/quarter metrics cited to support the plan included Q4 distributable earnings of $21.4M ($0.17/share; $26.4M or $0.21 adj.), FY distributable earnings $109.9M (7.1% ROE), loan portfolio $2.2B (42% of assets, 7.8% yield; four nonaccrual loans carrying $129.7M / 2.5% of assets), securities $2.1B (39% of assets, 5.3% yield, 99% investment-grade / 97% AAA), CECL reserve $47M ($0.37/share), undrawn repurchase capacity $90.6M remaining, book value $13.69/share, and a $0.23/share dividend (96% coverage ex-write-off).Ladder Capital Financial Statement Overview
Summary
Profitability and cash flow have been positive historically, but 2025 shows clear weakening (revenue and net income down; operating and free cash flow declining). The balance sheet remains meaningfully leveraged (common for the sector but still a risk amplifier), keeping the financial profile mid-range.Income Statement
Revenue has been volatile: strong rebound in 2021–2022, modest declines in 2023–2024, and a sharp drop in 2025 (to $388M from $511M). Profitability remains positive in most years, but net income weakened meaningfully in 2025 ($64M vs. $108M in 2024). Margins were strong in 2021–2024, but 2025 margin data is unavailable, limiting visibility into whether the earnings decline is mainly volume-driven or margin-driven. Overall: solid profitability history, but recent top-line and earnings momentum is a key concern.58
Neutral
Balance Sheet
The balance sheet is highly leveraged, which is common in mortgage REITs but still elevates risk. Debt-to-equity was ~2.05x in 2024 and ~2.47x in 2023, with total debt rising to $3.51B in 2025. Equity is relatively stable (~$1.48B–$1.54B), but returns on equity have been modest (about 6%–9% in 2022–2024). Overall: stable equity base, but leverage remains the dominant constraint and makes results more sensitive to credit/market conditions.44
Neutral
Cash Flow
Operating cash flow is consistently positive, but it has trended down over the last two years ($181M in 2023 to $134M in 2024 to $87M in 2025). Free cash flow is also positive, yet growth has been weak/negative recently, including a very large decline shown for 2025. Cash generation covered reported earnings well in 2022–2024 (free cash flow roughly in line with net income), but 2025 coverage metrics are unavailable, reducing confidence in near-term cash conversion. Overall: positive cash flow profile, but weakening trajectory.51
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 392.30M | 511.22M | 525.09M | 543.71M | 358.21M |
| Gross Profit | 281.54M | 394.88M | 415.23M | 429.00M | 246.87M |
| EBITDA | 275.39M | 366.46M | 381.55M | 400.25M | 280.46M |
| Net Income | 64.18M | 108.25M | 101.13M | 142.22M | 56.52M |
Balance Sheet | |||||
| Total Assets | 5.15B | 4.85B | 5.51B | 5.95B | 5.85B |
| Cash, Cash Equivalents and Short-Term Investments | 37.95M | 1.32B | 1.02B | 611.12M | 854.70M |
| Total Debt | 3.51B | 3.15B | 3.78B | 4.25B | 4.22B |
| Total Liabilities | 3.67B | 3.31B | 3.98B | 4.42B | 4.34B |
| Stockholders Equity | 1.48B | 1.54B | 1.53B | 1.53B | 1.51B |
Cash Flow | |||||
| Free Cash Flow | 87.02M | 133.92M | 180.60M | 106.71M | 79.74M |
| Operating Cash Flow | 87.02M | 133.92M | 180.60M | 106.71M | 79.74M |
| Investing Cash Flow | -1.61B | 932.76M | 793.50M | 81.59M | -651.46M |
| Financing Cash Flow | 227.04M | -796.59M | -557.77M | -150.24M | -91.02M |
Ladder Capital Technical Analysis
Negative
9.77
Price Trends
10.57
Negative
10.75
Negative
10.79
Negative
Market Momentum
-0.18
Positive
28.23
Positive
17.54
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LADR, the sentiment is Negative. The current price of 9.77 is below the 20-day moving average (MA) of 10.21, below the 50-day MA of 10.57, and below the 200-day MA of 10.79, indicating a bearish trend. The MACD of -0.18 indicates Positive momentum. The RSI at 28.23 is Positive, neither overbought nor oversold. The STOCH value of 17.54 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LADR.
Ladder Capital Risk Analysis
Ladder Capital disclosed 72 risk factors in its most recent earnings report. Ladder Capital reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Ladder Capital Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | $2.50B | 2.95 | 17.19% | 14.63% | 47.97% | 17.22% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
63 Neutral | $1.85B | 2.34 | 16.65% | 15.06% | -27.55% | -97.87% | |
60 Neutral | $1.40B | 10.61 | 6.83% | 9.89% | 0.29% | ― | |
58 Neutral | $1.41B | 9.19 | 8.54% | 11.37% | 70.94% | 2.95% | |
54 Neutral | $1.24B | 21.49 | 4.28% | 8.21% | -17.18% | -17.16% | |
53 Neutral | $1.05B | 4.43 | 8.85% | 11.40% | 9.46% | -111.44% |
* Real Estate Sector Average
LADR
Ladder Capital
9.77
-1.15
-10.51%
ARI
Apollo Real Estate
10.06
0.93
10.19%
ARR
ARMOUR Residential REIT
15.48
-0.07
-0.44%
CIM
Chimera Investment
12.63
0.22
1.74%
DX
Dynex Capital
12.39
0.42
3.48%
EFC
Ellington Financial
11.30
-0.61
-5.15%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.