Starwood Property Trust Inc. (STWD) recently reported first-quarter earnings, and the company is poised to generate strong earnings growth this year and into the next. I would not be surprised if STWD trades above $25 again in the coming year. Pick up shares while the price is near $20 and the yield is well over 9%, advises Tim Plaehn, editor of The Dividend Hunter.
The company originated $2.3 billion in new business in the first quarter – and has placed more than $1 billion so far in the second quarter. Starwood is poised to grow its loan book significantly, and the new business will help increase interest income and earnings.
Starwood Property Trust Inc. (STWD)
The Real Estate Investment Trust (REIT) is engaged in originating, acquiring, and managing commercial mortgage loans and commercial mortgage-backed securities in the US and Europe. It organizes its activities into segments: Commercial and Residential Lending, Infrastructure Lending, Property, and Investing and Servicing.
STWD has been a very long-term holding in the Dividend Hunter portfolio. It was in the very first issue from June 2014. A lot of stocks have come and gone, but STWD remains constant. I consider it a core holding.
Recommended Action: Buy STWD.
