Critical Comparison: KKR Real Estate Finance Trust (KREF) & The Competition

KKR Real Estate Finance Trust (NYSE: KREF) is one of 32 public companies in the “Mortgage REITs” industry, but how does it weigh in compared to its competitors? We will compare KKR Real Estate Finance Trust to similar businesses based on the strength of its dividends, valuation, risk, analyst recommendations, institutional ownership, earnings and profitability.

Earnings & Valuation

This table compares KKR Real Estate Finance Trust and its competitors revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
KKR Real Estate Finance Trust $41.19 million $31.15 million 19.84
KKR Real Estate Finance Trust Competitors $371.19 million $190.39 million 2.70

KKR Real Estate Finance Trust’s competitors have higher revenue and earnings than KKR Real Estate Finance Trust. KKR Real Estate Finance Trust is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Institutional and Insider Ownership

65.7% of KKR Real Estate Finance Trust shares are held by institutional investors. Comparatively, 56.9% of shares of all “Mortgage REITs” companies are held by institutional investors. 3.4% of shares of all “Mortgage REITs” companies are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares KKR Real Estate Finance Trust and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
KKR Real Estate Finance Trust 77.41% 6.08% 0.75%
KKR Real Estate Finance Trust Competitors 55.44% 10.00% 1.99%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for KKR Real Estate Finance Trust and its competitors, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
KKR Real Estate Finance Trust 0 3 0 0 2.00
KKR Real Estate Finance Trust Competitors 121 870 899 35 2.44

KKR Real Estate Finance Trust currently has a consensus target price of $22.50, suggesting a potential upside of 9.06%. As a group, “Mortgage REITs” companies have a potential upside of 4.55%. Given KKR Real Estate Finance Trust’s higher possible upside, research analysts clearly believe KKR Real Estate Finance Trust is more favorable than its competitors.

Dividends

KKR Real Estate Finance Trust pays an annual dividend of $1.48 per share and has a dividend yield of 7.2%. KKR Real Estate Finance Trust pays out 142.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Mortgage REITs” companies pay a dividend yield of 9.4% and pay out 92.5% of their earnings in the form of a dividend. KKR Real Estate Finance Trust lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Summary

KKR Real Estate Finance Trust competitors beat KKR Real Estate Finance Trust on 10 of the 14 factors compared.

About KKR Real Estate Finance Trust

KKR Real Estate Finance Trust Inc is a real estate finance company that focuses primarily on originating and acquiring senior mortgage loans secured by commercial real estate assets (CRE). KKR manages investments across multiple asset classes, including private equity, real estate, energy, infrastructure, credit and hedge funds. The Company’s investment strategy is to originate or acquire senior mortgage loans collateralized by institutional-quality CRE assets. Its target assets also include mezzanine loans, preferred equity and other debt-oriented instruments. The Company’s investment objective is capital preservation and generating attractive risk-adjusted returns for its stockholders over the long term, primarily through dividends.

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