GPMT Stock Overview
Granite Point Mortgage Trust Inc., a real estate investment trust, originates, invests in, and manages senior floating-rate commercial mortgage loans, and other debt and debt-like commercial real estate investments in the United States.
Granite Point Mortgage Trust Competitors
Price History & Performance
|Historical stock prices|
|Current Share Price||US$7.43|
|52 Week High||US$14.10|
|52 Week Low||US$7.37|
|1 Month Change||-24.80%|
|3 Month Change||-22.36%|
|1 Year Change||-45.25%|
|3 Year Change||-59.27%|
|5 Year Change||-61.04%|
|Change since IPO||-60.90%|
Recent News & Updates
Granite Point Mortgage's Preferred Shares Offer A 10% Yield To Call
GPMT owns a portfolio of senior floating-rate commercial real estate mortgage debt. The underlying result for Q2 was okay, but the dividend on the common shares isn't fully covered. The preferred shares offer a 7.9% yield and a 10.3% yield to call. In 2027, the preferred dividend will be reset if the securities haven't been called. I prefer the safety of the preferred dividends over exposure to the common units at this time. Introduction I have been following Granite Point Mortgage (GPMT) for a while now. I’m not too interested in the common shares but the preferred shares have dropped to a level that I think is now very appealing. An additional interesting feature of the preferred issue, which is trading with (GPMT.PA) as ticker symbol is the fix-to-float: in a few years the preferred dividend will be reset to the 3 month SOFR plus a mark-up. And as interest rates have been increasing, the reset could be more advantageous than I originally had thought. GPMT data by YCharts Granite Point’s Q2 results were improving While the headline result in the second quarter was very uninspiring (a net loss of 32 cents per share), the income statement of Granite Point shows the net loss was caused by a loan loss provision in combination with the loss on extinguishment of debt. GPMT Investor Relations As you can see in the image above, the net interest income was just under $22M and after deducting the $9.5M in other net operating expenses, the normalized net income would have been approximately $13.5M compared to the loss of $13.7M. And even after making the payments on the preferred shares (costing about $3.6M per quarter), Granite Point would still have posted a net income of approximately $10M or approximately 19 cents per share attributable to its shareholders. And if we would look at GPMT from a distributable earnings perspective (which also adds back the non-cash equity compensation to the equation), these earnings would have come in at $11.7M for a result of $0.22/share. GPMT Investor Relations This means it is important to understand why exactly GPMT posted a net loss in the second quarter. The loss on the extinguishment of debt is easy to explain. The company repaid the $100M owed under the senior secured term loan and the total payment included a prepayment penalty as well as a charge-off related to the unamortized discount used for this loan. This term loan had a total cost of around 8%, which means that going forward, Granite Point will save millions of dollars in interest expenses. The increased amount set aside to cover loan losses also makes sense. As of the end of June, the company had almost $3.9B in loans yet its total allowance for loan losses was just over $34M. As some more loans became riskier, Granite Point added an additional $13M to the provisions to make sure it was taking the appropriate measures to deal with some of the more questionable loans. GPMT Investor Relations This does not mean Granite Point is suddenly facing massive portfolio losses. Keep in mind the average LTV ratio is in the mid-60s range while GPMT usually also is the most senior creditor of a borrower entering the default stage. One of the assets where an additional provision was recorded is an office building in the San Diego market. And on the Q2 conference call, Granite Point’s management did a good job in explaining the situation. The soft leasing market in San Diego resulted in an impairment charge but GPMT also emphasized the sponsor has sunk a lot of equity in the project and is thus very incentivized to make it work rather than handing the keys to Granite Point. So as I mentioned in the prepared remarks, we placed the loan on non-accrual status took the asset-specific reserve that we mentioned of $4.5 million. We've been in ongoing call it constructive conversations with the sponsor. They have a significant amount of equity in the property. The CapEx portion of the business plan is complete, but leasing has been for the reasons that I mentioned. I also mentioned that the borrower is currently in the process of marketing the property […]. While it’s too bad seeing Granite Point moving some of the loans into a higher risk category, let’s not forget the total amount of loans with a risk rating of 4 and 5 have actually decreased compared to the end of last year. GPMT Investor Relations This also means the third quarter should be much better and the reported earnings should be getting closer to the distributable earnings as I expect to see a lower loan loss provision while there should be no additional losses on the early extinguishment of debt. Why does this matter for the preferred shareholders? As a reminder, the preferred shares were issued in November last year and the underwriters confirmed the issue price would be $25 and the preferred dividend would be $1.75 per year for a preferred dividend yield of 7%. As mentioned in the introduction, the preferred dividend will be reset in 2027 (if Granite Point doesn’t call the preferred securities). The call date is November 30th 2026, and from the next preferred dividend payment on, in 2027, the preferred dividend gets updated to the 3 month SOFR rate plus a mark-up of 583 base points. A second interesting feature is that there is a floor: the minimum preferred dividend will be 7%, even if the 3 month SOFR would be zero. With the 3 month SOFR currently at approximately 2.77%, this means that if the interest rate remains at the current level, the preferred dividend will reset to 8.6%. That’s 8.6% on the principal amount of $25 indicating an annual preferred dividend of $2.15 will be payable. We already know the distributable earnings were $11.3M during the quarter and this already includes the $3.6M in preferred dividend payments. This means the normalized distributable earnings before taking the preferred dividends into consideration was already $15M, resulting in a preferred dividend coverage ratio of in excess of 400%.
9.3%-Yielding Granite Point Mortgage Is Flying Under The Radar
GPMT is a high-yielding commercial real estate lender that's reasonably leveraged, with a strong investment pipeline and favorable outlook. It maintains a safe investment portfolio comprised primarily of senior first mortgages with a healthy weighted average loan to value ratio. Meanwhile, the stock trades at a material discount to book value and offers an attractive dividend yield. Commercial mortgage REITs remain an attractive asset class with high dividend yields, even when they are supposed to benefit from the impact of rising rates. This was seen in Blackstone Mortgage Trust's (BXMT) strong Q2 results, with strong originations and bottom line growth. This brings me to Granite Point Mortgage Trust (GPMT), which hasn't yet reported its second-quarter results, but may see a similar benefit. GPMT hasn't seen the same uptick in its share price that BXMT has, and in this article, I highlight why this may present a high yield buying opportunity. Why GPMT? Granite Point Mortgage Trust is a relative newcomer to the commercial mREIT space. It went public in 2017, and last year, made the shareholder-friendly move of internalizing its management. This helps to align the interests of shareholders and management, since external managers receive a part of their compensation based on the size of AUM. GPMT maintains a broadly diversified portfolio of commercial real estate loans that are backed by 99% senior first mortgages. Its portfolio also carries a safe 63% weighted average loan to value ratio. At present, the loan portfolio carries a $3.8 billion balance spread across 103 investments. As shown below, the portfolio is diversified by geography and asset type, with office, multifamily, and hotels comprising 85% of the total balance. GPMT Portfolio Mix (Investor Presentation) GPMT is making good headway, as it resolved three of four loans on nonaccrual status during its first quarter, reducing its nonaccruals ratio to 2.7% of the total loan portfolio. It's also seeing strong interest collections, with 100% of borrowers making their contractual payments in accordance with loan agreements. Moreover, GPMT is reasonably leveraged at 2.5x debt to equity. Moreover, GPMT fully repaid $225 million of borrowings under its higher-cost senior secured term loan facilities while releasing approximately $180 million of capital through refinancing 2 de-levered legacy funding vehicles, resulting in lower cost of funds. Distributable earnings came in at $0.24 per share, and management expects these actions to improve its quarterly run-rate net interest income by $0.05 to $0.06 per share. Looking forward, GPMT maintains a strong investment pipeline worth $200 million, and management plans on taking leverage up to 3.0-3.5x to help with funding. It's also well-positioned for a rising rate environment with 98% of its portfolio being floating rate. Risks to the growth thesis include potential for market volatility in the near term, and higher interest rates may affect borrowers' finances. However, given peer BXMT's strong Q2 results, I don't see this as being much of a factor for GPMT's second-quarter results. This is also supported by management's favorable outlook in the last conference call: We continue to see a healthy flow of attractive lending opportunities and are focused on properties with favorable fundamentals. Given the ongoing uncertainties with respect to global events, the pandemic, supply chain disruptions, inflation, rising interest rates and credit spreads, we remain disciplined in our approach to investing, underwriting and loan structure. Given our liquidity and leverage, we are well positioned to take advantage of wider loan spreads and remain opportunistic in further improving our capitalization. With the amount of volatility global markets are experiencing, we believe that U.S. commercial real estate will continue to be viewed as a safe haven asset class by long-term fundamental investors. And our strategy of lending on a senior floating rate basis against institutional quality real estate should generate attractive risk adjusted returns over time. While GPMT's quarterly dividend of $0.25 per share is slightly under-covered by the $0.24 in distributable EPS last quarter, I see potential for coverage to improve due to the aforementioned management actions, which could benefit quarterly EPS by $0.05 to $0.06.
|GPMT||US Mortgage REITs||US Market|
Return vs Industry: GPMT underperformed the US Mortgage REITs industry which returned -38.5% over the past year.
Return vs Market: GPMT underperformed the US Market which returned -22.1% over the past year.
|GPMT Average Weekly Movement||4.9%|
|Mortgage REITs Industry Average Movement||4.8%|
|Market Average Movement||6.9%|
|10% most volatile stocks in US Market||15.8%|
|10% least volatile stocks in US Market||2.8%|
Stable Share Price: GPMT is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.
Volatility Over Time: GPMT's weekly volatility (5%) has been stable over the past year.
About the Company
Granite Point Mortgage Trust Inc., a real estate investment trust, originates, invests in, and manages senior floating-rate commercial mortgage loans, and other debt and debt-like commercial real estate investments in the United States. The company provides intermediate-term bridge or transitional financing for various purposes, including acquisitions, recapitalizations, and refinancing, as well as a range of business plans, including lease-up, renovation, repositioning, and repurposing of the commercial property. As of December 31, 2021, its investment portfolio includes 105 commercial real estate loan investments.
Granite Point Mortgage Trust Fundamentals Summary
|GPMT fundamental statistics|
Is GPMT overvalued?See Fair Value and valuation analysis
Earnings & Revenue
|GPMT income statement (TTM)|
|Cost of Revenue||US$5.69m|
Last Reported Earnings
Jun 30, 2022
Next Earnings Date
|Earnings per share (EPS)||0.17|
|Net Profit Margin||10.99%|
How did GPMT perform over the long term?See historical performance and comparison
13.5%Current Dividend Yield
Does GPMT pay a reliable dividends?See GPMT dividend history and benchmarks
|Granite Point Mortgage Trust dividend dates|
|Ex Dividend Date||Sep 30 2022|
|Dividend Pay Date||Oct 17 2022|
|Days until Ex dividend||0 days|
|Days until Dividend pay date||17 days|
Does GPMT pay a reliable dividends?See GPMT dividend history and benchmarks
Is GPMT undervalued compared to its fair value, analyst forecasts and its price relative to the market?
Valuation Score 1/6
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Key Valuation Metric
Which metric is best to use when looking at relative valuation for GPMT?
Other financial metrics that can be useful for relative valuation.
|What is GPMT's n/a Ratio?|
Price to Earnings Ratio vs Peers
How does GPMT's PE Ratio compare to its peers?
|GPMT PE Ratio vs Peers|
|Company||PE||Estimated Growth||Market Cap|
NREF NexPoint Real Estate Finance
AFCG AFC Gamma
TRTX TPG RE Finance Trust
REFI Chicago Atlantic Real Estate Finance
GPMT Granite Point Mortgage Trust
Price-To-Earnings vs Peers: GPMT is expensive based on its Price-To-Earnings Ratio (43.2x) compared to the peer average (10.8x).
Price to Earnings Ratio vs Industry
How does GPMT's PE Ratio compare vs other companies in the US Mortgage REITs Industry?
Price-To-Earnings vs Industry: GPMT is expensive based on its Price-To-Earnings Ratio (43.2x) compared to the US Mortgage REITs industry average (10.2x)
Price to Earnings Ratio vs Fair Ratio
What is GPMT's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.
|Current PE Ratio||43.2x|
|Fair PE Ratio||22.7x|
Price-To-Earnings vs Fair Ratio: GPMT is expensive based on its Price-To-Earnings Ratio (43.2x) compared to the estimated Fair Price-To-Earnings Ratio (22.7x).
Share Price vs Fair Value
What is the Fair Price of GPMT when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.
Below Fair Value: GPMT ($7.43) is trading above our estimate of fair value ($4.19)
Significantly Below Fair Value: GPMT is trading above our estimate of fair value.
Analyst Price Targets
What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?
Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.
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How is Granite Point Mortgage Trust forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?
Future Growth Score3/6
Future Growth Score 3/6
Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: GPMT's forecast earnings growth (52.4% per year) is above the savings rate (1.9%).
Earnings vs Market: GPMT's earnings (52.4% per year) are forecast to grow faster than the US market (14.8% per year).
High Growth Earnings: GPMT's earnings are expected to grow significantly over the next 3 years.
Revenue vs Market: GPMT's revenue (6.5% per year) is forecast to grow slower than the US market (7.6% per year).
High Growth Revenue: GPMT's revenue (6.5% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: GPMT's Return on Equity is forecast to be low in 3 years time (5.8%).
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How has Granite Point Mortgage Trust performed over the past 5 years?
Past Performance Score0/6
Past Performance Score 0/6
Growing Profit Margin
Earnings vs Industry
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: GPMT has a large one-off loss of $27.7M impacting its June 30 2022 financial results.
Growing Profit Margin: GPMT's current net profit margins (11%) are lower than last year (30%).
Past Earnings Growth Analysis
Earnings Trend: GPMT's earnings have declined by 6.4% per year over the past 5 years.
Accelerating Growth: GPMT's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: GPMT had negative earnings growth (-77.8%) over the past year, making it difficult to compare to the Mortgage REITs industry average (-1.6%).
Return on Equity
High ROE: GPMT's Return on Equity (1.6%) is considered low.
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How is Granite Point Mortgage Trust's financial position?
Financial Health Score2/6
Financial Health Score 2/6
Short Term Liabilities
Long Term Liabilities
Financial Position Analysis
Short Term Liabilities: GPMT's short term assets ($4.1B) exceed its short term liabilities ($60.6M).
Long Term Liabilities: GPMT's short term assets ($4.1B) exceed its long term liabilities ($3.0B).
Debt to Equity History and Analysis
Debt Level: GPMT's net debt to equity ratio (274.2%) is considered high.
Reducing Debt: GPMT's debt to equity ratio has increased from 148.2% to 288.5% over the past 5 years.
Debt Coverage: GPMT's debt is not well covered by operating cash flow (1.7%).
Interest Coverage: Insufficient data to determine if GPMT's interest payments on its debt are well covered by EBIT.
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What is Granite Point Mortgage Trust current dividend yield, its reliability and sustainability?
Dividend Score 2/6
Cash Flow Coverage
Current Dividend Yield
Dividend Yield vs Market
|Granite Point Mortgage Trust Dividend Yield vs Market|
|Company (Granite Point Mortgage Trust)||13.5%|
|Market Bottom 25% (US)||1.6%|
|Market Top 25% (US)||4.6%|
|Industry Average (Mortgage REITs)||13.6%|
|Analyst forecast in 3 Years (Granite Point Mortgage Trust)||13.5%|
Notable Dividend: GPMT's dividend (13.46%) is higher than the bottom 25% of dividend payers in the US market (1.67%).
High Dividend: GPMT's dividend (13.46%) is in the top 25% of dividend payers in the US market (4.69%)
Stability and Growth of Payments
Stable Dividend: GPMT has been paying a dividend for less than 10 years and during this time payments have been volatile.
Growing Dividend: GPMT has only been paying a dividend for 5 years, and since then payments have fallen.
Earnings Payout to Shareholders
Earnings Coverage: With its high payout ratio (598.5%), GPMT's dividend payments are not well covered by earnings.
Cash Payout to Shareholders
Cash Flow Coverage: With its high cash payout ratio (100%), GPMT's dividend payments are not well covered by cash flows.
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How experienced are the management team and are they aligned to shareholders interests?
Average management tenure
Jack Taylor (66 yo)
Mr. John A. Taylor, also known as Jack, J.D., is Chief Executive Officer of Granite Point Mortgage Trust Inc. since April 7, 2017 and is its President. Mr. Taylor is a Chief Investment Officer at Pine Rive...
CEO Compensation Analysis
|Jack Taylor's Compensation vs Granite Point Mortgage Trust Earnings|
|Date||Total Comp.||Salary||Company Earnings|
|Jun 30 2022||n/a||n/a|
|Mar 31 2022||n/a||n/a|
|Dec 31 2021||US$5m||US$1m|
|Sep 30 2021||n/a||n/a|
|Jun 30 2021||n/a||n/a|
|Mar 31 2021||n/a||n/a|
|Dec 31 2020||US$3m||n/a|
|Sep 30 2020||n/a||n/a|
|Jun 30 2020||n/a||n/a|
|Mar 31 2020||n/a||n/a|
|Dec 31 2019||US$1m||n/a|
|Sep 30 2019||n/a||n/a|
|Jun 30 2019||n/a||n/a|
|Mar 31 2019||n/a||n/a|
|Dec 31 2018||US$1m||n/a|
|Sep 30 2018||n/a||n/a|
|Jun 30 2018||n/a||n/a|
|Mar 31 2018||n/a||n/a|
|Dec 31 2017||US$2m||n/a|
Compensation vs Market: Jack's total compensation ($USD4.73M) is above average for companies of similar size in the US market ($USD2.92M).
Compensation vs Earnings: Jack's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.
Experienced Management: GPMT's management team is seasoned and experienced (5.4 years average tenure).
Experienced Board: GPMT's board of directors are considered experienced (5.7 years average tenure).
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.
|Owner Type||Number of Shares||Ownership Percentage|
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
|Ownership||Name||Shares||Current Value||Change %||Portfolio %|
Granite Point Mortgage Trust Inc.'s employee growth, exchange listings and data sources
- Name: Granite Point Mortgage Trust Inc.
- Ticker: GPMT
- Exchange: NYSE
- Founded: 2015
- Industry: Mortgage REITs
- Sector: Diversified Financials
- Implied Market Cap: US$388.968m
- Shares outstanding: 52.35m
- Website: https://www.gpmtreit.com
Number of Employees
- Granite Point Mortgage Trust Inc.
- 3 Bryant Park
- 24th Floor, Suite 2400A
- New York
- New York
- United States
|Ticker||Exchange||Primary Security||Security Type||Country||Currency||Listed on|
|GPMT||NYSE (New York Stock Exchange)||Yes||New Common Stock||US||USD||Jun 2017|
|G18||DB (Deutsche Boerse AG)||Yes||New Common Stock||DE||EUR||Jun 2017|
|GPMT.PRA||NYSE (New York Stock Exchange)||7% FLTG PFD SR A||US||USD||Nov 2021|
Company Analysis and Financial Data Status
|Data||Last Updated (UTC time)|
|Company Analysis||2022/09/28 00:00|
|End of Day Share Price||2022/09/28 00:00|
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.