Granite Point Mortgage (GPMT) AI Stock Analysis

• Market Cap: $121.01M
• Dividend Yield: 8%
• Average Volume (3M): 772.40K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.30
• Revenue Growth: -26.87%
• EPS Growth: -189.15%
• Country: US
• Employees: 33
• Sector: Real Estate
• Sector Strength: 55
• Industry: REIT - Mortgage
• EPS (TTM): -0.57
• Shares Outstanding: 48,405,860
• 10 Day Avg. Volume: 276,292
• 30 Day Avg. Volume: 772,397
• PEG Ratio: 0.04
• Price to Book (P/B): 0.29
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 4.82
• Enterprise Value/Market Cap: 12.94
• Enterprise Value/Revenue: 14.41
• Enterprise Value/Gross Profit: 41.56
• Enterprise Value/Ebitda: 24.39
• 1Y Price Target: $3.00
• Price Target Upside: 20.00% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 49 Neutral
• Price Target: ―

Granite Point Mortgage faces significant financial headwinds, primarily due to declining revenues and net losses. The company has made strides in debt management and liquidity improvement, but persistent challenges with non-performing loans and credit loss provisions weigh heavily. Technical analysis suggests the stock is oversold, indicating potential for recovery, but caution is advised. Valuation metrics are mixed, reflecting both risk and potential value, while management's strategic focus on loan resolutions and share buybacks offers some optimism.

Positive Factors

Loan Portfolio

The portfolio was composed of 99% senior first mortgage loans and 97% of the loans have a floating interest rate.

Share Repurchase

During the quarter, GPMT repurchased 1.2M shares of its common stock, which increased book value by $0.13 per share.

Negative Factors

Earnings

Granite Point reported a GAAP loss of $0.86 per share and a distributable loss of $1.98 per share, which was below consensus and analyst estimates.

Loan Loss Reserves

GAAP earnings were negatively impacted by a $27.9M, or $0.55 per share, increase to CECL loan loss reserves.

Loan Write-Offs

Distributable earnings were negatively impacted by $95.2M in write-offs related to the resolution of four 5-rated loans.

Problematic Loans

Loans assigned a 5-rating at December 31 total 21.5% of the portfolio, remaining essentially flat from September 30.

Granite Point Mortgage Business Overview & Revenue Model

Company Description

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 Inc. was founded in 2015 and is headquartered in New York, New York.

How the Company Makes Money

Granite Point Mortgage Trust Inc. generates revenue primarily through the interest income earned on its portfolio of commercial real estate loans. The company originates loans, typically senior floating rate loans, and earns interest over the life of the loan. GPMT also benefits from fees associated with loan origination and, occasionally, from the sale of loans or other real estate investments. By focusing on floating rate loans, GPMT seeks to position itself favorably in varying interest rate environments, which can impact its net interest income. The company's performance is influenced by factors such as prevailing interest rates, credit conditions in the commercial real estate market, and the overall economic environment.

Granite Point Mortgage Financial Statement Overview

Summary

Granite Point Mortgage is experiencing significant financial challenges, with declining revenues and widening net losses impacting profitability. Despite strong cost management reflected in a high gross margin, the overall pressure from high net losses and asset reduction is substantial. However, the elimination of total debt and strategic management of financing activities provide some positive offsets.

Income Statement

Granite Point Mortgage's income statement reveals significant challenges. The company experienced a substantial decline in revenue from $266.5 million in 2023 to $185.6 million in 2024, a drop of approximately 30.4%. Net income also turned negative at -$221.5 million in 2024, down from -$63.2 million in 2023, negatively impacting net profit margins. Gross profit margin remained strong at approximately 89.5% in 2024, indicating efficient cost management despite revenue drops, but overall profitability remains under pressure due to high net losses.

Balance Sheet

The balance sheet shows a decrease in total assets from $2.85 billion in 2023 to $2.12 billion in 2024, alongside a decline in stockholders' equity from $858.9 million to $619.1 million. The debt-to-equity ratio improved as total debt was cleared in 2024. However, the equity ratio decreased from 30.2% in 2023 to 29.3% in 2024, reflecting reduced financial stability. The company's ability to improve its debt position is a positive indicator, but overall equity and asset reduction signal caution.

Cash Flow

Granite Point Mortgage demonstrated a significant improvement in cash flow metrics. Operating cash flow remains positive at $8.76 million in 2024, though significantly reduced from $52.1 million in 2023. Free cash flow followed a similar trend. Despite this decline, the company reduced its financing outflows substantially, which may support future liquidity. While cash flows were pressured, strategic management of financing activities provided some relief.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	37.67M	39.86M	266.49M	78.26M	112.73M	72.19M
Gross Profit	37.67M	39.86M	261.18M	47.28M	82.64M	43.16M
EBITDA	0.00	0.00	0.00	0.00	0.00	0.00
Net Income	-139.94M	-207.05M	-63.20M	-40.83M	68.35M	-40.44M
Balance Sheet
Total Assets	2.03B	2.12B	2.85B	3.45B	3.99B	4.22B
Cash, Cash Equivalents and Short-Term Investments	0.00	0.00	188.37M	3.48B	191.93M	261.42M
Total Debt	860.06M	875.09M	1.95B	1.41B	2.26B	1.53B
Total Liabilities	1.43B	1.50B	1.99B	2.47B	2.97B	3.28B
Stockholders Equity	604.67M	619.09M	858.90M	983.54M	1.01B	933.85M
Cash Flow
Free Cash Flow	-1.68M	5.99M	52.10M	58.90M	60.30M	20.25M
Operating Cash Flow	1.40M	8.76M	52.10M	58.90M	60.30M	20.25M
Investing Cash Flow	498.23M	435.24M	561.43M	408.63M	139.77M	341.62M
Financing Cash Flow	-567.22M	-528.74M	-554.47M	-531.66M	-324.97M	-192.44M

Granite Point Mortgage Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2.50
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GPMT, the sentiment is Positive. The current price of 2.5 is above the 20-day moving average (MA) of 2.49, above the 50-day MA of 2.38, and below the 200-day MA of 2.64, indicating a neutral trend. The MACD of 0.04 indicates Positive momentum. The RSI at 51.33 is Neutral, neither overbought nor oversold. The STOCH value of 59.91 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GPMT.

Granite Point Mortgage Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LOAN	71 Outperform	$61.77M	11.25	12.70%	8.55%	-5.84%	-3.44%
Sector *	64 Neutral	$6.97B	18.61	-1.93%	6.82%	4.65%	-25.39%
ACR	60 Neutral	$131.54M	61.47	5.47%	―	-13.68%	-53.53%
LFT	56 Neutral	$109.36M	10.50	6.38%	11.48%	-10.98%	-35.75%
CHMI	50 Neutral	$91.12M	43.78	-2.83%	21.50%	0.33%	-37.48%
GPMT	49 Neutral	$121.01M	―	-20.41%	8.00%	-26.87%	-189.15%
SACH	47 Neutral	$61.03M	―	-20.80%	15.50%	-55.51%	-493.18%

Granite Point Mortgage Corporate Events

Granite Point Mortgage Appoints New Board Members

Granite Point Mortgage Trust Inc. announced the appointment of Patrick Halter and Lazar Nikolic to its Board of Directors, effective January 15, 2025. Mr. Halter joins the Compensation Committee and Mr. Nikolic the Nominating and Corporate Governance Committee. This move is part of Granite Point’s strategy to enhance board expertise and navigate current market conditions, aiming to drive growth and shareholder value.