Wells Fargo analyst Donald Fandetti has maintained their bullish stance on KREF stock, giving a Buy rating on April 16.
Donald Fandetti has given his Buy rating due to a combination of factors influencing KKR Real Estate Finance’s current financial standing and future prospects. Despite a slight decline in book value and some credit rating downgrades within their loan portfolio, the company maintains a strong dividend yield of 10.9%, which is attractive to investors. Moreover, the shares are trading at a significant discount to book value, at 0.63 times, suggesting potential for appreciation.
Fandetti also notes that while there are challenges in transitional commercial real estate lending, there have been improvements in the office sector and a return of capital to debt and equity markets. The potential for further Federal Reserve rate cuts could also provide a favorable environment for KKR Real Estate Finance. Despite some setbacks, the management’s outlook on repayments and lending opportunities remains positive, supporting the Buy recommendation.
According to TipRanks, Fandetti is a 5-star analyst with an average return of 10.4% and a 61.32% success rate. Fandetti covers the Financial sector, focusing on stocks such as Synchrony Financial, American Express, and Capital One Financial.
In another report released on April 16, J.P. Morgan also maintained a Buy rating on the stock with a $9.50 price target.