A Closer Look at Starwood Property Trust (STWD) Valuation After Recent Share Price Uptick

Starwood Property Trust (STWD) shares edged higher recently, catching investors’ attention. The stock has seen some movement over the past week, and many are weighing what this could signal in the context of the current market.

See our latest analysis for Starwood Property Trust.

After a fairly stable run, Starwood Property Trust’s latest share price move hints at shifting sentiment, perhaps reflecting renewed confidence in its outlook. While the one-day and weekly share price returns have seen modest upticks, the real story lies in the company’s resilience. With a 4.2% total shareholder return over the past year and a strong 75.8% total return over five years, it has rewarded patient investors, though recent momentum appears tempered compared to its long-term gains.

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But with the current share price sitting below analyst targets and signs of fundamental growth, is the market overlooking Starwood Property Trust’s true value? Or are investors right to question if future gains are already factored in?

Most Popular Narrative: 15.7% Undervalued

With the most widely followed narrative projecting a fair value of $21.86 per share, Starwood Property Trust’s recent closing price sits comfortably below consensus expectations. This gap has captured attention and reflects both optimism and questions about what might be driving such confidence.

"The acquisition and ramp-up of the net lease portfolio (Fundamental Income), combined with ongoing infrastructure lending growth, position Starwood to generate high-quality, durable earnings streams across a more diversified asset base. This supports both net margin expansion and greater earnings consistency."

Read the complete narrative.

The real story is in the numbers behind this bold outlook. This narrative hints at aggressive future growth, sector-changing earnings potential, and strategic portfolio moves. Curious about the assumptions driving this bullish price target? The full narrative breaks down the forecasts that could reshape how you value Starwood.

Result: Fair Value of $21.86 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent sector headwinds and exposure to nonaccrual assets could challenge Starwood’s ability to maintain earnings growth and support long-term dividend stability.

Find out about the key risks to this Starwood Property Trust narrative.

Story Continues

Another View: Market Multiples Tell a Different Story

While many see value based on fair value models, traditional price-to-earnings ratios offer a less optimistic perspective. Starwood Property Trust currently trades at 18.7 times earnings, making it more expensive than both the peer average of 15 times and the industry, which sits at 12.3 times. Compared to its fair ratio of 13.7 times, this signals the market may be pricing in growth or defensiveness that is not a given. Could this higher premium pose a risk for investors, or is it simply reflecting quality?

See what the numbers say about this price — find out in our valuation breakdown.NYSE:STWD PE Ratio as at Nov 2025

Build Your Own Starwood Property Trust Narrative

Feel like this narrative misses the mark or want to dig into the numbers your own way? You can craft your own take in just minutes and Do it your way

A great starting point for your Starwood Property Trust research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include STWD.

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