Assessing Blackstone Mortgage's Performance For Q2 2024

Core Insights - Blackstone Mortgage Trust, Inc. (BXMT) experienced a minor quarterly book value (BV) decrease, which was anticipated, with a net increase in CECL reserves of $143 million, leading to a BV underperformance of $0.10 per share [1] - The company originated $0.4 billion in loans during Q2 2024, while experiencing $0.7 billion in loan prepayments and repayments, indicating a defensive strategy [1] - BXMT's adjusted core earnings/EAD showed a minor outperformance of $0.02, primarily due to a smaller-than-expected decrease in the investment portfolio size [1][2] Earnings Results - BXMT reported a GAAP BV of $22.90, which was a 0.43% miss compared to projections [3] - Adjusted core earnings were reported at $0.564, beating the consensus estimate by 4.44% but showing a 13.1% decline from the prior quarter [3] Valuation Metrics - The current price of BXMT is $19.21, with a projected NAV of $22.50, indicating a price to NAV ratio of 0.85 [4] - The dividend yield payout ratio is forecasted at 12.91%, with a risk rating of 4.5 [4] Credit Metrics - BXMT's non-accrual loans increased from 10.7% to 13.2% of the fair market value of the investment portfolio from Q1 to Q2 2024, reflecting anticipated credit risk [6] - The company added three loans to non-accrual status during Q2 2024, with significant loans located in New York and California [6][9] Dividend Adjustments - BXMT announced a dividend cut for Q3 2024 from $0.65 to $0.47 per share, which was more severe than previously projected [10] - The company is currently rated as a HOLD, with expectations of a gradual recovery in stock price over the next couple of years [11]