STARWOOD PROPERTY TRUST INC. Starwood Property Trust Inc. (STWD)

FairStock Score: 60/100 — STEADY

Key Financials

Strengths

• Healthy net profit margin of 17.7% showing consistent profitability
• Revenue growth of 30.9% demonstrates strong top-line momentum
• Attractive 10.5% dividend yield providing steady income returns

Concerns

• High leverage at 2.97x debt-to-equity increases financial risk and interest expense burden
• Altman Z-Score of 0.1 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

STARWOOD PROPERTY TRUST INC. Starwood Property Trust Inc. is a small-cap real estate company valued at $6.9 billion. The business generates $548 million in annual revenue with a 17.7% net margin. From a quality standpoint, STARWOOD shows distressed Altman Z-Score of 0.1 warrants caution and modest 6% ROE. On valuation, the stock is reasonably priced at 15.8x earnings, with a modest 17% margin of safety vs Graham Number. Growth dynamics show revenue growing at 30.9% and profit growth of 87.7%. The 10.5% dividend yield adds an income component for patient holders. Our composite FairStock Score of 60/100 reflects above-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

STARWOOD's 31% revenue growth trajectory could accelerate as it captures additional market share in the real estate sector. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

Elevated leverage at 3.0x D/E means rising interest rates or revenue weakness could strain debt covenants and force asset sales at distressed prices. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer