These 2 Double-Digit Mortgage Trusts Hit 52-Week Lows - Will REITs See a Rally?

When evaluating mortgage real estate investment trusts (REITs), one factor to consider is that the stock price should never trade at a premium to book value greater than its dividend yield.

In addition, mortgage REITs tend to have higher yields than equity REITs, achieving a five-year dividend yield of 10.8%.

As interest rates rise, increasing the cost of capital to borrow, equity REITs may have to dilute their investors to raise capital or take on debt. While mortgage REITs can modify the terms of loan agreements to better protect against rising interest rates, such as locking in variable rate loans. Read on to learn about two mortgage real estate investment trusts trending below their book value.

See also: Tokenized Multifamily Real Estate Investment with a Target IRR of 16.8%

Rithm Capital Corporation RITM offers a dividend yield of 12.97% or $1.00 per share per year, using quarterly payments, with a history of increasing its dividend once in the past year. The New York-based company operates as a mortgage real estate investment trust that provides capital and services to the real estate and financial services industries. It has a book value per share of $12.28 and its quarterly mount funded the production of an outstanding principal balance (UPB) of $19.1 billion, up from $26.9 billion (UPB) in the first quarter. 2022. The company has also expanded its single-family rental portfolio. of 324 units in the second quarter. Blackstone Mortgage Trust Inc. BXMT offers a dividend yield of 10.60% or $2.48 per share per year, making quarterly payments, with a history of increasing its dividend once in the past year. Blackstone Mortgage Trust is a real estate finance company primarily involved in the origination and purchase of senior loans secured by commercial properties in North America, Europe and Australia. The vast majority of the Company's asset portfolio consists of variable rate loans secured by senior mortgages. In the second quarter, $3 billion in loans backed by top-tier sponsors and high-quality assets, in high-conviction sectors such as travel and leisure, multifamily real estate, industrials and news office buildings. Additionally, the portfolio has $2.8 billion in loan funding, resulting in a net increase of $1.4 billion in investments in progress. As of June 30, Blackstone had a book value per share of $27.17 per share.

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