Starwood Property: Don't Fool Yourself, A Dividend Cut Is Coming (Rating Downgrade)

The Asian Investor 32.97K Followers Follow Summary Starwood Property Trust, Inc. again failed to cover its $0.48 dividend in Q2 ’26, marking six consecutive quarters of under-coverage. STWD’s dividend coverage ratio was 83% in Q2 ’26, lagging peers Ladder Capital and Blackstone Mortgage Trust, both of which exceeded 100%. Despite improving collateral diversification and a robust liquidity position, persistent dividend undercoverage puts STWD’s payout at risk. I see STWD’s current valuation as unjustified given weak coverage trends and superior alternatives trading at higher discounts to book value. Richard Drury/DigitalVision via Getty Images Starwood Property Trust's ( STWD ) results for the second quarter exceeded Wall Street’s expectations in terms of earnings available for distribution, but the commercial real estate finance REIT continued to struggle with its dividend This article was written by The Asian Investor 32.97K Followers Follow I am interested in a lot of technology and AI stocks like Google, Nvidia, AMD, Tesla and Amazon. Analyst’s Disclosure: I/we have a beneficial long position in the shares of LADR either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.