Analyst Ronald Kamdem from Morgan Stanley maintained a Hold rating on Safehold (SAFE – Research Report) and keeping the price target at $19.00.
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Ronald Kamdem has given his Hold rating due to a combination of factors, including Safehold’s recent financial performance aligning with expectations and the company’s strategic initiatives. The financial results showed a consistent core FFO of $0.40, matching both Morgan Stanley and consensus estimates, while new originations and funding levels were significantly lower than the previous quarter. Despite a modest increase in the portfolio’s gross book value and a stable unencumbered asset value, the unchanged portfolio cash and GAAP yields suggest a steady performance without significant growth indicators.
Another contributing factor to the Hold rating is the company’s improved credit rating from Fitch, upgraded to A- from BBB+, which indicates a stronger financial position. However, the overall liquidity position, although improved, and a significant authorized buyback, do not justify a more aggressive rating given the current debt-to-equity ratio and unchanged rent coverage. Thus, Kamdem’s Hold rating reflects a balanced outlook, acknowledging Safehold’s stable position while recognizing limited immediate growth prospects.
According to TipRanks, Kamdem is a 4-star analyst with an average return of 4.3% and a 54.91% success rate. Kamdem covers the Real Estate sector, focusing on stocks such as Healthpeak Properties, SL Green Realty, and Highwoods Properties.
In another report released yesterday, Truist Financial also maintained a Hold rating on the stock with a $20.00 price target.