Starwood Property Trust (NYSE:STWD) Issues Earnings Results

Key Points

• Starwood Property Trust reported quarterly EPS of $0.31, beating the $0.27 consensus, while revenue of $545.9 million also exceeded estimates; revenue nevertheless fell 22.8% year over year.
• The company recorded a $389.7 million GAAP net loss, including a $336.6 million credit-loss provision, as reserves for commercial lending non-accruals and REO rose to about $1.0 billion.
• CEO Barry Sternlicht said the board will review the dividend, which has exceeded recent earnings, and a cut is possible. The company also reported $2.4 billion in commercial lending originations, lifting that portfolio to a record $17.8 billion.

Starwood Property Trust (NYSE:STWD - Get Free Report) released its quarterly earnings data on Friday. The real estate investment trust reported $0.31 EPS for the quarter, topping analysts' consensus estimates of $0.27 by $0.04, FiscalAI reports. Starwood Property Trust had a net margin of 11.35% and a return on equity of 7.85%. The firm had revenue of $545.85 million during the quarter, compared to the consensus estimate of $531.80 million. During the same quarter in the previous year, the company posted $0.40 earnings per share. The firm's revenue was down 22.8% on a year-over-year basis.

Here are the key takeaways from Starwood Property Trust's conference call:

• Distributable earnings were $0.31 per share, or $0.41 excluding realized resolution losses. CEO Barry Sternlicht said the board will review the dividend, which has exceeded recent earnings, and a cut is possible.
• Reserves for commercial lending non-accruals and REO reached about $1.0 billion after a $369 million quarterly increase, largely attributed to higher interest-rate assumptions in the company’s model. Undepreciated book value was $17.22 per share; management said there were no new non-accrual loans or foreclosures.
• The company resolved $254 million of non-accrual loans and REO, returned a $108 million Brooklyn office loan to accrual after leasing it to full occupancy, and said it remains on track for roughly $800–$850 million in 2026 resolutions.
• Commercial lending originations were $2.4 billion, helping lift that portfolio by $528 million to a record $17.8 billion. Starwood reported $1.1 billion in liquidity, 3.15x debt-to-undepreciated-equity leverage, and $108 million of share repurchases during the quarter.
• Management highlighted continued contributions from diversified businesses, including $37 million in quarterly special-servicing fees and net lease operations that became accretive to distributable earnings. Woodstar also implemented average 8.9% HUD rent increases, which added $1.7 million to quarterly earnings.

Starwood Property Trust Price Performance

NYSE STWD traded down $0.84 on Friday, reaching $12.04. The company's stock had a trading volume of 11,538,286 shares, compared to its average volume of 5,973,494. Starwood Property Trust has a twelve month low of $11.84 and a twelve month high of $18.66. The company has a debt-to-equity ratio of 3.47, a quick ratio of 1.46 and a current ratio of 1.46. The firm's 50 day moving average is $13.77 and its two-hundred day moving average is $16.41. The stock has a market cap of $4.46 billion, a PE ratio of 20.41, a PEG ratio of 1.75 and a beta of 1.03.

Starwood Property Trust Announces Dividend

The company also recently declared a quarterly dividend, which was paid on Thursday, October 15th. Stockholders of record on Wednesday, September 30th were given a dividend of $0.48 per share. The ex-dividend date was Wednesday, September 30th. This represents a $1.92 annualized dividend and a dividend yield of 15.9%. Starwood Property Trust's dividend payout ratio (DPR) is 325.42%.

Starwood Property Trust News Roundup

Here are the key news stories impacting Starwood Property Trust this week:

• Positive Sentiment: Distributable earnings were $0.31 per share, above the $0.27 consensus estimate. The company cited interest and rental income and servicing fees as contributors. Starwood Property's Q3 earnings boosted by interest and rental income, servicing fees
• Positive Sentiment: Starwood invested $3.2 billion during the quarter, including $2.4 billion in commercial lending, and said its commercial lending portfolio reached a record $17.8 billion. It also repurchased $108 million of shares and reported a $0.48-per-share dividend. Starwood Property Trust Reports Results for Quarter Ended September 30, 2026
• Neutral Sentiment: Analysts’ average price target was reported at $18.50, though that consensus does not remove concerns raised by the quarter’s credit costs. Starwood Property Trust average analyst target
• Negative Sentiment: The company posted a $389.7 million GAAP net loss, including a $336.6 million credit-loss provision and $32.2 million in non-cash property impairments. Distributable earnings before realized commercial lending gains and losses were $0.41 per share, while distributable earnings were lower than the $0.40 reported a year earlier. Starwood Property Trust third-quarter results
• Negative Sentiment: Keefe, Bruyette & Woods cut its price target on STWD, adding a potentially bearish analyst signal. Keefe, Bruyette & Woods cuts Starwood Property Trust price target

Analyst Ratings Changes

STWD has been the topic of a number of recent research reports. Wells Fargo & Company set a $20.00 price target on shares of Starwood Property Trust in a research report on Monday, August 17th. JPMorgan Chase & Co. lowered their price objective on shares of Starwood Property Trust from $19.00 to $18.50 and set an "overweight" rating for the company in a research report on Tuesday, August 18th. Citigroup reiterated a "market outperform" rating on shares of Starwood Property Trust in a research note on Monday, October 26th. Keefe, Bruyette & Woods cut their target price on shares of Starwood Property Trust from $16.00 to $15.00 and set an "outperform" rating on the stock in a report on Wednesday. Finally, Zacks Research upgraded Starwood Property Trust from a "hold" rating to a "strong-buy" rating in a research note on Tuesday, October 20th. One research analyst has rated the stock with a Strong Buy rating, five have issued a Buy rating, one has assigned a Hold rating and one has issued a Sell rating to the stock. According to data from MarketBeat, the company presently has an average rating of "Moderate Buy" and an average target price of $18.50.

About Starwood Property Trust

Starwood Property Trust, Inc is a real estate investment trust that focuses on commercial real estate finance and related investments. The company originates, acquires, and manages a range of real estate debt and equity investments, serving institutional borrowers, property owners, and developers.

Its portfolio and lending activities include senior mortgage loans, mezzanine debt, subordinated loans, preferred equity, commercial mortgage-backed securities, and other structured real estate investments.

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