KKR Real Estate stock target cut to $12 by JMP Securities

On Thursday, JMP Securities analyst Steven DeLaney adjusted the price target for KKR Real Estate Finance Trust (NYSE:KREF), bringing it down to $12.00 from the previous $13.00, while maintaining a Market Outperform rating. According to InvestingPro analysis, KREF appears undervalued at its current price of $9.28, with a perfect Piotroski Score of 9 indicating strong financial health. This decision comes in the wake of KKR Real Estate Finance Trust’s first-quarter financial results, which were disclosed after the market closed on April 23, 2025.

KKR Real Estate Finance Trust reported a GAAP loss of $0.15 per share for the first quarter of 2025. However, the company’s distributable earnings per share (EPS) was $0.25, surpassing the consensus estimate of $0.17 from five analysts and only slightly below the Street-high estimate of $0.29 per share. The distributable EPS was sufficient to cover the quarterly dividend of $0.25, achieving a coverage ratio of 100%. Notably, InvestingPro data shows KREF has maintained dividend payments for 9 consecutive years, with a current yield of 10.78%, making it one of the highest-yielding stocks in its sector.

The GAAP earnings suffered due to a $25 million, or $0.36 per share, additional Current Expected Credit Loss (CECL) loan loss provision. This provision also affected the book value per share, which decreased to $14.44 from $14.76 as of December 31, impacted by the rise in CECL reserves. Despite these challenges, InvestingPro analysis reveals strong fundamentals with a current ratio of 134.42, indicating robust liquidity position. Get access to 10+ additional exclusive ProTips and comprehensive financial metrics with InvestingPro’s detailed research report.

DeLaney’s new price target of $12.00 is based on an 8.3% required yield on the current annualized dividend of $1.00 and corresponds to 0.83 times the book value per share. If the new price target is met, it implies a potential total return of approximately 40%, with a price appreciation of 29.3% and a cash dividend yield of 10.8%.

KKR Real Estate Finance Trust is scheduled to host its quarterly earnings conference call on Thursday, April 24, at 9:00 a.m. Eastern Time. Interested parties can join the call by dialing (844) 784-1730, with no passcode required.

In other recent news, KKR Real Estate Finance Trust Inc . disclosed its financial results for both the first quarter ending March 31, 2025, and the fourth quarter and full year ending December 31, 2024. The real estate investment trust released earnings reports and supplemental financial data to provide insights into its operational and financial performance. These filings, made in compliance with SEC requirements, include forward-looking statements based on current expectations but are not guarantees of future performance. The company emphasized that actual results might vary due to factors beyond its control and does not commit to updating these projections unless legally required. Investors are encouraged to review the detailed reports and supplementary data to understand the company’s financial health and strategic plans. KKR Real Estate Finance Trust Inc. also highlighted that these documents are not filed for regulatory purposes and will not be incorporated into future filings under the Securities Act. The company’s recent annual report and periodic filings contain further information on factors influencing its performance.

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