Riding on a steady growth momentum, shares of
NorthStar Realty Finance Corp.
) reached a new 52-week high of $16.16 on Mar 12. This commercial
real estate investment and service provider witnessed a jump of
about 21.4% since the beginning of 2014.
Moreover, the encouraging momentum of NorthStar is fueled by
strategic initiatives to re-align business and a robust
investment pipeline, thereby enhancing its real estate
Yesterday's closing price represents a robust one-year return
of about 76.4% against a return of 20.4% clocked by the S&P
500 index. Average volume of shares traded over the last three
months stands at approximately 10.08 million.
On Feb 27, NorthStar reported fourth-quarter 2013 operating
earnings per share of 32 cents, in line with the Zacks Consensus
Estimate but declined from the year-ago number of 75 cents.
Results reflected robust growth in total revenue driven by
higher asset management fee and rental income. However, the
positives were more than offset by higher interest and operating
expenses, which resulted in a reduced bottom line. Conversely, an
appreciated cash and asset base along with reduction in
liabilities at the end of 2013 reflect a strong capital
While NorthStar boasts of a healthy investment portfolio, the
company is on track to spin off its asset management business
into an independent publicly-traded company - NorthStar Asset
Management Group Inc. (NSAM) - by mid-2014.
NorthStar aims to accelerate its non-traded REIT business
through NSAM and diversify latter's fee streams, further
propelling long-term growth opportunities. NSAM is extremely well
positioned to drive value at NorthStar with its unique asset base
and one-of-a-kind structure.
Concurrently, NorthStar has showcased prudent capital
management by refinancing debt on improved terms recently, in
order to remain sufficiently liquid and lower the borrowing
costs. This, in turn, leaves ample scope for pursuing capital
deployment strategies.We believe the upcoming quarters should
benefit from these operating and capital actions, as reflected in
the market's positive reaction.
Some better-ranked insurers that warrant a look are
Jones Lang LaSalle Inc.
). All these stocks carry a Zacks Rank #2 (Buy). NorthStar
carries a Zacks Rank #4 (Sell).
FIRSTSERVICE CP (FSRV): Free Stock Analysis
JONES LANG LASL (JLL): Free Stock Analysis
NORTHSTAR RLTY (NRF): Free Stock Analysis
REIS INC (REIS): Free Stock Analysis Report
To read this article on Zacks.com click here.