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Ladder Capital (LADR)
NYSE:LADR
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Ladder Capital (LADR) AI Stock Analysis

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LADR

Ladder Capital

(NYSE:LADR)

Rating:71Outperform
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 (LADR) vs. SPDR S&P 500 ETF (SPY)

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 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 Earnings Call Summary

Earnings Call Date:Jul 24, 2025
(Q2-2025)
|
% Change Since: -0.45%|
Next Earnings Date:Oct 23, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive outlook with significant achievements, such as obtaining investment-grade status and a successful bond issuance. These are expected to improve the financial flexibility and cost structure of the company. However, challenges remain in the loan origination space and with certain nonaccrual loans.
Q2-2025 Updates
Positive Updates
Achievement of Investment-Grade Status
Ladder Capital achieved investment-grade status with upgrades from Moody's and Fitch to Baa3 and BBB-, respectively. This marks a significant milestone and is expected to improve the company's cost of debt capital.
Successful Bond Issuance
The company issued its inaugural $500 million 5-year investment-grade unsecured bond at a fixed rate coupon of 5.5%, with the offering being 5.5x oversubscribed.
Strong Liquidity Position
Ladder Capital maintained $1 billion in liquidity, including a fully undrawn $850 million unsecured revolving credit facility with a reduced rate of SOFR plus 125 basis points.
Robust Investment Activity
Over $1 billion of investments were made, including $600 million in AAA-rated securities with an average unlevered yield of 6.1%.
Stable Real Estate Portfolio Income
$15.1 million in net operating income was generated from a $936 million real estate portfolio, primarily consisting of net lease properties with long-term leases.
Negative Updates
Loan Origination Challenges
Loan origination activity remained flat with $191 million in payoffs largely offset by $173 million in new originations. Delays in closing loans were noted, with some concerns in the multifamily and hotel sectors.
Loans on Nonaccrual
Five loans totaling $162.3 million were on nonaccrual, representing 3.6% of total assets. An additional $50 million nonaccrual loan collateralized by a multifamily asset was noted.
Net Lease Portfolio Yield Concerns
While there is interest in growing the net lease portfolio, current cap rates and financing costs limit opportunities for profitable expansion.
Company Guidance
During the second quarter of 2025, Ladder Capital Corp. achieved significant financial metrics and milestones, including generating distributable earnings of $30.9 million or $0.23 per share, and a return on equity of 7.7%, with modest adjusted leverage of just 1.6x as of quarter-end. The company celebrated a pivotal achievement, attaining investment-grade ratings with Moody's and Fitch upgrading Ladder to Baa3 and BBB-, respectively. This upgrade facilitated the successful issuance of a $500 million 5-year investment-grade unsecured bond with a fixed coupon rate of 5.5%, representing a 167 basis point spread over the benchmark treasury, marking the tightest spread achieved in Ladder's history. This issuance was met with exceptional demand, being 5.5x oversubscribed, which contributed to enhanced liquidity, with 74% of Ladder's debt now consisting of unsecured corporate bonds and 83% of its balance sheet assets remaining unencumbered. As of June 30, Ladder's liquidity stood at $1 billion, bolstered by an $850 million unsecured revolving credit facility that remains fully undrawn. The company's securities portfolio totaled $2 billion, representing 44% of total assets, while the loan portfolio was $1.6 billion, representing 36% of total assets. Ladder's real estate portfolio generated net operating income of $15.1 million, primarily consisting of net lease properties with long-term leases to investment-grade tenants. Looking forward, Ladder anticipates continued tightening of bond spreads and aims to be increasingly compared to high-quality equity REITs, reflecting its strong liquidity, conservative balance sheet, and focus on delivering stable returns to shareholders.

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
75
Positive
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
60
Neutral
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
70
Positive
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.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue277.48M268.99M339.66M183.61M139.96M
Gross Profit277.48M189.76M278.04M133.97M43.88M
EBITDA364.76M0.00398.16M0.0014.36M
Net Income108.25M101.13M142.22M56.52M-14.45M
Balance Sheet
Total Assets4.85B5.51B5.95B5.85B5.88B
Cash, Cash Equivalents and Short-Term Investments1.32B1.02B615.30M1.25B1.49B
Total Debt3.07B3.18B4.25B4.22B3.39B
Total Liabilities3.31B3.98B4.42B4.23B4.33B
Stockholders Equity1.54B1.53B1.53B1.51B1.54B
Cash Flow
Free Cash Flow133.92M180.60M99.76M74.87M105.84M
Operating Cash Flow133.92M180.60M106.71M79.74M111.94M
Investing Cash Flow932.76M793.50M81.59M-651.46M1.54B
Financing Cash Flow-796.59M-557.77M-150.24M-91.02M-725.67M

Ladder Capital Technical Analysis

Technical Analysis Sentiment
Positive
Last Price11.05
Price Trends
50DMA
10.64
Positive
100DMA
10.59
Positive
200DMA
10.72
Positive
Market Momentum
MACD
0.13
Positive
RSI
55.60
Neutral
STOCH
40.67
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 Risk Analysis

Ladder Capital disclosed 70 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

Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
71
Outperform
$1.42B15.875.83%8.26%-12.51%7.76%
67
Neutral
$668.41M12.026.22%11.47%-13.64%
66
Neutral
$1.37B0.41%10.14%-14.98%95.53%
63
Neutral
$3.36B-2.06%9.75%-20.46%-1436.71%
59
Neutral
C$1.25B-2.64-8.19%5.08%10.84%-18.98%
54
Neutral
$608.41M56.21-1.76%10.83%-16.46%
49
Neutral
$128.76M-20.41%7.52%-26.87%-189.15%
* Real Estate Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
LADR
Ladder Capital
11.05
-0.14
-1.25%
ARI
Apollo Real Estate
9.76
0.10
1.04%
BXMT
Blackstone Mortgage
19.29
2.97
18.20%
KREF
Kkr Real Estate Finance
9.18
-1.12
-10.87%
GPMT
Granite Point Mortgage
2.60
-0.23
-8.13%
TRTX
Tpg Re Finance
8.37
0.49
6.22%
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.Date of analysis: May 03, 2025