Ladder Capital (LADR) AI Stock Analysis

• Market Cap: $1.42B
• Dividend Yield: 8.26%
• Average Volume (3M): 814.49K
• Price to Earnings (P/E): 15.9
• Beta (1Y): 0.60
• Revenue Growth: -12.51%
• EPS Growth: 7.76%
• Country: US
• Employees: 54
• Sector: Real Estate
• Sector Strength: 57
• Industry: REIT - Mortgage
• EPS (TTM): 0.23
• Shares Outstanding: 127,471,870
• 10 Day Avg. Volume: 986,623
• 30 Day Avg. Volume: 814,489
• PEG Ratio: -0.62
• Price to Book (P/B): 0.93
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 17.30
• Enterprise Value/Market Cap: 2.86
• Enterprise Value/Revenue: 3.74
• Enterprise Value/Gross Profit: -0.03
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $12.83
• Price Target Upside: 16.11% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

• Rating: 71 Outperform
• Price Target: ―

Ladder Capital's overall score reflects strong financial performance and a positive outlook from its earnings call, supported by robust liquidity and strategic investments. However, high leverage and market uncertainties are concerns. Technical analysis shows a neutral trend, and valuation metrics are favorable, contributing to a solid investment case.

Positive Factors

Credit Rating

Fitch upgraded Ladder Capital's credit rating to BBB- with a stable outlook, marking a major step forward in the company's pivot to growth.

Dividend Coverage

Distributable earnings per share were comfortably covering the quarterly dividend, with a coverage ratio of 117%.

Investment Opportunities

LADR shares offer an attractive total return investment opportunity as the company executes on its primary goals of core transitional (bridge) loan portfolio growth and the harvesting of gains on seasoned net lease real estate assets.

Negative Factors

Loan Portfolio

The loan portfolio has decreased by 22.2% from September 30 due to strong borrower repayments.

Stock Valuation

Ladder Capital's shares are trading at a discount to book value, offering a potential price appreciation of 20% over the last closing price.

Ladder Capital Business Overview & Revenue Model

Company Description

The 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 Money

Ladder Capital generates revenue primarily through interest and fees earned on its portfolio of commercial real estate loans and securities. The company's key revenue streams include income from lending activities, such as interest income from first mortgage loans and balance sheet loans, as well as gains from the sale of CMBS and other real estate-related securities. Additionally, Ladder Capital benefits from equity investments in real estate, generating rental income and potential capital appreciation. Strategic partnerships with institutional investors and financial institutions enhance its ability to source and manage high-quality assets, contributing to its earnings. The company's diversified approach to real estate finance allows it to capitalize on various market opportunities while managing risk effectively.

Ladder Capital Financial Statement Overview

Summary

Ladder Capital shows strong revenue growth and operational efficiency with robust gross and EBITDA margins. However, high leverage poses a potential risk, and there's a need for improvement in net margins and cash flow growth.

Income Statement

Ladder Capital's TTM (Trailing-Twelve-Months) revenue shows steady growth with a revenue growth rate of 10.07% compared to the previous year. The gross profit margin stands strong at 83.42%, indicating efficient cost management. However, the net profit margin decreased slightly to 33.86% in TTM, reflecting some pressure on net profitability. The EBIT margin improved to 48.51%, showing better operational efficiency. The EBITDA margin is notably high at 107.89%, underscoring strong earnings before interest, taxes, depreciation, and amortization.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 1.61, which suggests significant leverage and potential risk if market conditions deteriorate. However, the company maintains reasonable stability with an equity ratio of 33.93%, indicating a balanced asset structure. The return on equity (ROE) for TTM is 6.82%, which is modest and reflects room for enhancement in shareholder returns.

Cash Flow

Ladder Capital's cash flow position is healthy with an operating cash flow to net income ratio of 1.21, indicating strong cash generation relative to net income. The free cash flow to net income ratio is 1.23, suggesting effective free cash flow management. However, the free cash flow growth rate over the past year shows a slight decline of 5.21%, which could imply some challenges in growing cash reserves.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	277.48M	268.99M	339.66M	183.61M	139.96M
Gross Profit	277.48M	189.76M	278.04M	133.97M	43.88M
EBITDA	364.76M	0.00	398.16M	0.00	14.36M
Net Income	108.25M	101.13M	142.22M	56.52M	-14.45M
Balance Sheet
Total Assets	4.85B	5.51B	5.95B	5.85B	5.88B
Cash, Cash Equivalents and Short-Term Investments	1.32B	1.02B	615.30M	1.25B	1.49B
Total Debt	3.07B	3.18B	4.25B	4.22B	3.39B
Total Liabilities	3.31B	3.98B	4.42B	4.23B	4.33B
Stockholders Equity	1.54B	1.53B	1.53B	1.51B	1.54B
Cash Flow
Free Cash Flow	133.92M	180.60M	99.76M	74.87M	105.84M
Operating Cash Flow	133.92M	180.60M	106.71M	79.74M	111.94M
Investing Cash Flow	932.76M	793.50M	81.59M	-651.46M	1.54B
Financing Cash Flow	-796.59M	-557.77M	-150.24M	-91.02M	-725.67M

Ladder Capital Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 11.05
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LADR, the sentiment is Positive. The current price of 11.05 is above the 20-day moving average (MA) of 11.05, above the 50-day MA of 10.64, and above the 200-day MA of 10.72, indicating a bullish trend. The MACD of 0.13 indicates Positive momentum. The RSI at 55.60 is Neutral, neither overbought nor oversold. The STOCH value of 40.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LADR.

Ladder Capital Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LADR	71 Outperform	$1.42B	15.87	5.83%	8.26%	-12.51%	7.76%
TRTX	67 Neutral	$668.41M	12.02	6.22%	11.47%	-13.64%	―
ARI	66 Neutral	$1.37B	―	0.41%	10.14%	-14.98%	95.53%
BXMT	63 Neutral	$3.36B	―	-2.06%	9.75%	-20.46%	-1436.71%
Sector *	59 Neutral	C$1.25B	-2.64	-8.19%	5.08%	10.84%	-18.98%
KREF	54 Neutral	$608.41M	56.21	-1.76%	10.83%	-16.46%	―
GPMT	49 Neutral	$128.76M	―	-20.41%	7.52%	-26.87%	-189.15%