Franklin BSP Realty Trust (FBRT) AI Stock Analysis

Compare

376 Followers

Top Page

Franklin BSP Realty Trust

(NYSE:FBRT)

Rating:56Neutral

Price Target:―

FBRT's stock score reflects a mixed financial outlook with strengths in operational efficiency and strategic growth initiatives. However, the company faces significant challenges in revenue stability, cash flow consistency, and technical indicators suggest a bearish trend. The valuation is supported by a high dividend yield, though concerns about dividend sustainability weigh on the stock's attractiveness. The earnings call highlighted both opportunities and risks, contributing to a balanced yet cautious overall assessment.

Positive Factors

Loan Originations

Originations accelerated 16.1% sequentially to $441M, highlighting the company's strong underwriting capabilities and management's confidence in its portfolio outlook.

New Business Line

Franklin BSP Realty Trust, Inc. is adding a new business line that positions it to be a leading multi-channel CMREIT.

Negative Factors

Dividend Coverage

The company's distributable EPS did not fully cover the $0.355 per share quarterly dividend.

Watchlist and REO Portfolio

The company has yet to reach stability in either its watchlist or its REO portfolio, and the dividend remains uncovered for the third consecutive quarter.

Franklin BSP Realty Trust (FBRT) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$906.63M

Dividend Yield12.87%

Average Volume (3M)448.50K

Price to Earnings (P/E)16.2

Beta (1Y)0.67

Revenue Growth-6.28%

EPS Growth-49.57%

CountryUS

EmployeesN/A

SectorReal Estate

Sector Strength68

IndustryREIT - Mortgage

Share Statistics

EPS (TTM)-0.12

Shares Outstanding83,637,436

10 Day Avg. Volume396,752

30 Day Avg. Volume448,500

Financial Highlights & Ratios

PEG Ratio-0.87

Price to Book (P/B)0.61

Price to Sales (P/S)0.00

P/FCF Ratio5.78

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$14.88

Price Target Upside37.27% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering4

Franklin BSP Realty Trust Business Overview & Revenue Model

Company DescriptionFranklin BSP Realty Trust, Inc., a real estate finance company, originates, acquires, and manages a portfolio of commercial real estate debt secured by properties located in the United States. The company also originates conduit loans; and invests in commercial real estate securities, as well as owns real estate acquired through foreclosure and deed in lieu of foreclosure, and purchased for investment. In addition, it invests in commercial real estate debt investments, which includes first mortgage loans, mezzanine loans, bridge loans, and other loans related to commercial real estate. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was formerly known as Benefit Street Partners Realty Trust, Inc. Franklin BSP Realty Trust, Inc. was incorporated in 2012 and is headquartered in New York, New York.

How the Company Makes MoneyFranklin BSP Realty Trust generates revenue primarily through interest income from its portfolio of commercial real estate debt investments. These investments include first mortgage loans, subordinate loans, and other real estate-related securities. The company earns interest income by providing these loans and collecting interest payments over the life of the loan. Additionally, FBRT may also receive income from fees associated with loan origination and other services. The trust's earnings are largely influenced by the interest rate environment, the credit quality of its borrowers, and the overall performance of the commercial real estate market. Strategic partnerships with real estate professionals and financial institutions also play a role in sourcing and managing its investment opportunities.

Franklin BSP Realty Trust Earnings Call Summary

Earnings Call Date:Apr 28, 2025

(Q1-2025)

% Change Since: -6.87%|

Next Earnings Date:Aug 05, 2025

Earnings Call Sentiment Neutral

The earnings call presented a balanced view of FBRT's performance. While there were strong highlights such as robust loan origination, strategic focus on multifamily, and the promising acquisition of NewPoint, there were significant lowlights including negative distributable earnings, challenges with REO and nonperforming loans, and concerns over dividend coverage. The sentiment reflects cautious optimism with acknowledgment of current challenges.

Q1-2025 Updates

Positive Updates

Strong Loan Origination and Portfolio Management

FBRT originated $341 million in new loan commitments in Q1 2025, with new loans enhancing the portfolio due to high-quality properties and low loan-to-value ratios. This positions FBRT well in volatile markets.

Significant Loan Repayments

FBRT received $353 million in loan repayments, with 56% of the portfolio now originated post-interest rate hike, indicating a high-quality mortgage REIT portfolio.

Pending Acquisition of NewPoint

The acquisition of NewPoint, set to close early in Q3 2025, is expected to provide meaningful synergies and enhance FBRT's strategic focus on the multifamily sector.

Multifamily Sector Focus

Multifamily accounted for 79% of FBRT's total origination volume in Q1 2025, indicating a strategic focus on this sector.

Strong Liquidity Position

FBRT reported liquidity of $913 million at the end of Q1 2025, including $215 million in unrestricted cash, providing a strong base for future operations.

Negative Updates

Negative Distributable Earnings

FBRT reported negative distributable earnings of $6.2 million due to realized losses in the office asset REO portfolio.

Impact of REO and Nonperforming Loans

REO and nonperforming loans negatively impacted earnings, with plans to liquidate assets causing short-term drag on earnings.

Concerns Over Long-term Dividend Coverage

FBRT anticipates potential shortfalls in dividend coverage due to REO and nonperforming loan portfolios, suggesting a possible need to revisit dividend policy.

Increased Watch List and REO Portfolio

Four loans were added to the watch list in Q1 2025, and the foreclosure REO portfolio had 12 positions, indicating ongoing challenges in portfolio management.

Company Guidance

During the Franklin BSP Realty Trust First Quarter 2025 Earnings Conference Call, the company provided detailed guidance on several key metrics. They reported originating $341 million in new loan commitments, with multifamily loans accounting for 79% of the total. The company received $353 million in loan repayments, bringing the percentage of their portfolio originated post-interest rate hike to 56%. The REO portfolio accounted for a near-term drag on earnings, with $38.6 million in realized losses impacting distributable earnings, reported as negative $6.2 million or negative $0.12 per fully converted share. Liquidity stood at $913 million, including $215 million in unrestricted cash, and the average risk rating at quarter-end was 2.2. The company also highlighted the strategic acquisition of NewPoint, which is expected to close early in the third quarter, aiming to expand their market reach and enhance earnings quality.

Franklin BSP Realty Trust Financial Statement Overview

Summary

Franklin BSP Realty Trust shows operational efficiency improvements but struggles with revenue consistency. The balance sheet is strong with reduced leverage, yet asset management requires attention. Cash flow reflects volatility, highlighting the need for better cash generation. Overall, the company has strengths in operational efficiency but faces challenges in revenue stability and cash flow consistency.

Income Statement

Neutral

Franklin BSP Realty Trust has shown fluctuating revenue with a noticeable decline in the most recent year. The company experienced negative gross profit in 2023 and a significant drop in net income in 2024. However, EBIT and EBITDA margins have improved, indicating better operational efficiency. Overall, the income statement reflects instability in revenue but some operational improvements.

Balance Sheet

Positive

The balance sheet shows a strong equity base with no total debt reported in the latest year, suggesting reduced leverage risk. However, the equity ratio has been inconsistent, reflecting potential asset management issues. Overall, the balance sheet is stable, with a strong equity position and reduced leverage risk, but the fluctuations in equity ratio indicate areas for improvement.

Cash Flow

Neutral

The cash flow statement indicates volatility, with operating cash flow dropping to zero in the most recent year. Free cash flow also saw a decline, indicating cash management challenges. The company needs to focus on improving cash generation consistency to enhance financial stability.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
571.78M	548.92M	230.79M	367.36M	221.65M	184.17M
	Gross Profit
172.00M	210.45M	-108.63M	201.65M	160.81M	113.96M
	EBIT
305.15M	406.24M	154.77M	52.31M	164.96M	62.35M
	EBITDA
89.51M	116.41M	163.18M	106.55M	167.07M	64.58M
	Net Income Common Stockholders
57.02M	68.89M	145.22M	14.43M	25.70M	54.75M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
364.11M	387.42M	343.69M	415.04M	154.93M	82.07M
	Total Assets
5.84B	6.00B	5.96B	6.20B	9.47B	3.19B
	Total Debt
4.08B	4.31B	4.18B	4.45B	7.57B	2.15B
	Net Debt
3.85B	4.13B	3.85B	4.27B	7.42B	2.07B
	Total Liabilities
4.25B	4.48B	4.28B	4.63B	7.76B	2.39B
	Stockholders Equity
1.57B	1.51B	1.65B	1.56B	1.71B	798.44M
Cash Flow		Free Cash Flow
160.50M	57.23M	197.39M	151.85M	3.03B	115.33M
	Operating Cash Flow
160.50M	57.23M	197.39M	152.51M	146.50M	115.33M
	Investing Cash Flow
270.80M	-155.47M	380.81M	3.10B	1.07B	240.69M
	Financing Cash Flow
-79.38M	-48.58M	-424.99M	-3.23B	-1.14B	-373.00M

Franklin BSP Realty Trust Technical Analysis

Technical Analysis Sentiment

Negative

Last Price10.84

Price Trends

50DMA

11.55

Negative

100DMA

12.06

Negative

200DMA

12.13

Negative

Market Momentum

MACD

-0.17

Positive

RSI

37.90

Neutral

STOCH

39.71

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FBRT, the sentiment is Negative. The current price of 10.84 is below the 20-day moving average (MA) of 11.18, below the 50-day MA of 11.55, and below the 200-day MA of 12.13, indicating a bearish trend. The MACD of -0.17 indicates Positive momentum. The RSI at 37.90 is Neutral, neither overbought nor oversold. The STOCH value of 39.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FBRT.

Franklin BSP Realty Trust Risk Analysis

Franklin BSP Realty Trust disclosed 56 risk factors in its most recent earnings report. Franklin BSP Realty Trust reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 3 New Risks

Loans on properties in transition will involve a greater risk of loss than conventional mortgage loans. Q4, 2024

When we acquire companies, we face risks related to integrating the acquired company in a manner that allows us to achieve the synergies and other benefits of the acquisition or do so within the anticipated time frame. Q4, 2024

Changes to the U.S. federal income tax laws, including the enactment of certain tax reform measures, could have a material and adverse effect on us. Q4, 2024

Franklin BSP Realty Trust Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EFC	65 Neutral	$1.17B	8.98	9.59%	12.41%	11.91%	52.26%
CIM	63 Neutral	$1.07B	8.83	8.09%	11.08%	7.13%	64.82%
MFA	62 Neutral	$947.49M	9.40	7.34%	15.16%	26.34%	79.07%
Sector *	61 Neutral	$2.82B	10.77	0.50%	8439.01%	5.72%	-20.80%
DX	60 Neutral	$1.27B	15.35	6.01%	13.95%	73.74%	-34.10%
FBRT	56 Neutral	$906.63M	16.20	5.07%	12.87%	-6.28%	-49.57%
RC	46 Neutral	$714.43M	―	-12.42%	20.69%	-31.47%	-204.79%

* Real Estate Sector Average

Performance Comparison

FBRT

Franklin BSP Realty Trust

10.84

-0.50

-4.41%

CIM

Chimera Investment

13.06

2.45

23.09%

Dynex Capital

11.89

1.17

10.91%

EFC

Ellington Financial

12.39

1.77

16.67%

MFA

MFA Financial

9.23

-0.11

-1.18%

Ready Capital

4.19

-3.17

-43.07%

Franklin BSP Realty Trust Corporate Events

Executive/Board ChangesShareholder Meetings

Franklin BSP Realty Trust Holds Annual Stockholder Meeting

Neutral

Jun 2, 2025

On May 28, 2025, Franklin BSP Realty Trust, Inc. held its annual meeting of stockholders where several key decisions were made. The stockholders elected seven directors to the board for one-year terms and ratified the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm for 2025. However, a proposal to eliminate supermajority voting requirements was not approved, while the advisory vote on executive compensation was passed.

The most recent analyst rating on (FBRT) stock is a Buy with a $16.00 price target. To see the full list of analyst forecasts on Franklin BSP Realty Trust stock, see the FBRT Stock Forecast page.

M&A TransactionsBusiness Operations and Strategy

Franklin BSP Realty Trust Expands with NewPoint Acquisition

Positive

Mar 10, 2025

On March 9, 2025, Franklin BSP Realty Trust, Inc. announced its acquisition of NewPoint Holdings JV LLC, a commercial real estate finance company. The transaction, expected to close in the third quarter of 2025, aims to expand FBRT’s multifamily lending offerings and increase its market reach. The acquisition is anticipated to enhance FBRT’s earnings power and diversify its business lines, including agency and mortgage servicing. This strategic move is expected to create a comprehensive one-stop client solution, enhance long-term stockholder value, and potentially allow FBRT to trade at a premium to book value.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.