Starwood Property (STWD)
NYSE:STWD
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Starwood Property
(NYSE:STWD)
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Rating:64Neutral
Price Target:
$19.00
▲(8.70% Upside)
Action:ReiteratedDate:02/25/26
The score is primarily supported by improving cash-flow performance and constructive earnings-call guidance around dividend coverage and deployment, partially offset by volatility/leverage and some data-quality flags in the financials. Technicals are the main near-term drag, with the stock trending below major moving averages and bearish momentum signals. Valuation is moderately supportive mainly due to the high dividend yield, while the P/E is only mid-range.
Positive Factors
Improving Cash Generation
Operating cash flow turned positive after a 2021 outflow and has grown through 2022–2025, with free cash flow rising and closely tracking net income in multiple years. This sustained cash generation strengthens ability to fund dividends, repay or refinance debt, and support new originations.
Negative Factors
Concentrated Credit Stress
Concentrated nonaccruals and REO totalling over $1.6B create material idiosyncratic risk; resolution timing and recoveries can compress distributable earnings and cash flow for multiple quarters, raising capital and operational execution demands during remediation.
Read all positive and negative factors
Positive Factors
Negative Factors
Improving Cash Generation
Operating cash flow turned positive after a 2021 outflow and has grown through 2022–2025, with free cash flow rising and closely tracking net income in multiple years. This sustained cash generation strengthens ability to fund dividends, repay or refinance debt, and support new originations.
Read all positive factors
Starwood Property (STWD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.47B
Dividend Yield10.53%
Average Volume (3M)3.48M
Price to Earnings (P/E)14.7
Beta (1Y)0.60
Revenue Growth-13.19%
EPS Growth-11.26%
CountryUS
Employees286
SectorReal Estate
Sector Strength53
IndustryREIT - Mortgage
Share Statistics
EPS (TTM)0.42
Shares Outstanding370,581,760
10 Day Avg. Volume3,705,147
30 Day Avg. Volume3,479,858
Financial Highlights & Ratios
PEG Ratio1.85
Price to Book (P/B)0.89
Price to Sales (P/S)3.23
P/FCF Ratio9.85
Enterprise Value/Market Cap4.36
Enterprise Value/Revenue14.90
Enterprise Value/Gross Profit18.48
Enterprise Value/Ebitda15.32
Forecast
1Y Price Target
$20.80Price Target Upside18.99% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
EPS Forecast (FY)1.8
Revenue Forecast (FY)$2.05B
Starwood Property Business Overview & Revenue Model
Company Description
Starwood Property Trust, Inc. operates as a real estate investment trust (REIT) in the United States, Europe, and Australia. It operates through four segments: Commercial and Residential Lending, Infrastructure Lending, Property, and Investing and...
How the Company Makes Money
Starwood Property Trust generates revenue primarily through interest income from its mortgage loans and real estate-related investments. The company originates, acquires, and manages a variety of loans, including first mortgages, subordinate mortg...
Starwood Property Earnings Call Summary
Earnings Call Date:Feb 25, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 30, 2026
Earnings Call Sentiment Positive
The call presented a mix of strong operational and capital-markets achievements—record deployment ($12.7B), infrastructure and securitization wins, improved liquidity and conservative leverage—alongside identifiable near-term drags from timing/cash carry, concentrated nonaccruals/foreclosures, and several idiosyncratic credit downgrades. Management articulated clear remediation plans (asset resolution, redeployment of $1.9B unfunded commitments, net-lease integration and securitization wins) and showed a line of sight to dividend coverage on an adjusted basis. On balance, positive execution and structural improvements outweigh the near-term credit and timing headwinds.Positive Updates
Quarterly and Adjusted Distributable Earnings
Reported Q4 distributable earnings (DE) of $160 million, or $0.42 per share; adjusted for timing items DE would have been $0.49 per share, indicating underlying earnings power above the reported result.
Negative Updates
Timing-Related Drag on Quarterly Earnings
Timing issues reduced Q4 DE by $0.07 per share (new net lease cylinder contributed $0.03 vs. $0.06 run-rate and higher-than-normal cash balances reduced earnings by $0.04), understating underlying earnings power for the quarter.
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Q4-2025 Updates
Positive
Negative
Quarterly and Adjusted Distributable Earnings
Reported Q4 distributable earnings (DE) of $160 million, or $0.42 per share; adjusted for timing items DE would have been $0.49 per share, indicating underlying earnings power above the reported result.
Read all positive updates
Company Guidance
Management said distributable earnings and dividend coverage should steadily improve through 2026—pointing to a clear line of sight to cover the $1.92 annual dividend and to exceed the adjusted 2025 DE run-rate of $1.95 per share once legacy nonaccrual/REO is resolved and unfunded commitments fund. They expect the commercial loan portfolio to top $17.0 billion in Q1, to deploy at least a similar pace to 2025’s $6.4–6.5 billion of commercial lending, and to target resolution of roughly $1.0 billion of nonaccruals/repayments this year; 2025 deployments totaled $12.7 billion (including a record $2.6 billion in infrastructure and $2.4 billion in net lease), with $2.5 billion in Q4. Capital and liquidity actions—$1.4 billion of current liquidity, $11.9 billion available financing, record $4.4 billion of corporate debt/equity raised in 2025, a debt-to-undepreciated-equity ratio of 2.4x, unsecured debt at 18% (off-balance-sheet 22%)—plus Q4 securitizations that created ~$290 million of proceeds and ABS/CLO financings (e.g., $391 million ABS at 5.26%, infra CLOs at SOFR+1.68–1.72%) are expected to reduce cash drag (Q4 cash drag ~ $0.04) and acquisition dilution (net-lease contributed $0.03 in Q4 versus a $0.06 run-rate; its portfolio WALT 17.3 years, 100% occupancy, 2.3% annual escalators), driving improving DE coverage over the year.Starwood Property Financial Statement Overview
Summary
Income Statement
66
Positive
Balance Sheet
61
Positive
Cash Flow
72
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.88B | 2.04B | 2.05B | 1.55B | 1.19B |
| Gross Profit | 1.51B | 1.76B | 1.76B | 1.25B | 739.34M |
| EBITDA | 1.84B | 1.80B | 1.90B | 1.85B | 1.03B |
| Net Income | 411.54M | 359.93M | 339.21M | 871.48M | 447.74M |
Balance Sheet | |||||
| Total Assets | 63.18B | 62.56B | 69.50B | 79.04B | 83.85B |
| Cash, Cash Equivalents and Short-Term Investments | 800.48M | 471.64M | 258.10M | 374.45M | 361.34M |
| Total Debt | 22.20B | 9.01B | 8.87B | 9.71B | 7.48B |
| Total Liabilities | 55.69B | 55.36B | 62.48B | 71.84B | 77.20B |
| Stockholders Equity | 6.80B | 6.44B | 6.25B | 6.46B | 6.07B |
Cash Flow | |||||
| Free Cash Flow | 616.30M | 618.65M | 503.51M | 188.52M | -1.02B |
| Operating Cash Flow | 616.30M | 646.59M | 528.60M | 213.74M | -989.98M |
| Investing Cash Flow | -3.41B | 2.08B | 855.07M | -2.95B | -4.28B |
| Financing Cash Flow | 2.91B | -2.49B | -1.45B | 2.80B | 4.87B |
Starwood Property Technical Analysis
Negative
17.48
Price Trends
17.96
Negative
18.09
Negative
18.75
Negative
Market Momentum
-0.17
Positive
43.55
Neutral
41.08
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STWD, the sentiment is Negative. The current price of 17.48 is below the 20-day moving average (MA) of 17.74, below the 50-day MA of 17.96, and below the 200-day MA of 18.75, indicating a bearish trend. The MACD of -0.17 indicates Positive momentum. The RSI at 43.55 is Neutral, neither overbought nor oversold. The STOCH value of 41.08 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for STWD.
Starwood Property Risk Analysis
Starwood Property disclosed 107 risk factors in its most recent earnings report. Starwood Property 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
Starwood Property Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
64 Neutral | $6.47B | 14.75 | 6.21% | 10.53% | -13.19% | -11.26% | |
61 Neutral | $11.05B | 3.06 | 15.10% | 13.98% | 729.50% | -53.65% | |
55 Neutral | $1.91B | 2.34 | 16.65% | 15.06% | -27.55% | -97.87% | |
55 Neutral | $3.24B | 20.67 | 3.05% | 9.32% | -18.22% | ― | |
55 Neutral | $5.18B | 9.03 | 8.35% | 8.95% | -1.07% | 47.50% | |
54 Neutral | $1.46B | 15.24 | 4.99% | 17.27% | -18.13% | -40.87% |
* Real Estate Sector Average
STWD
Starwood Property
17.45
-1.01
-5.46%
AGNC
AGNC Investment
9.84
1.60
19.48%
ARR
ARMOUR Residential REIT
16.01
1.71
11.97%
ABR
Arbor Realty
7.56
-2.84
-27.29%
BXMT
Blackstone Mortgage
19.19
0.74
3.99%
RITM
Rithm Capital
9.31
-1.35
-12.63%
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.