Starwood Property Trust (STWD) combines attractive dividend income and upside for capital appreciation tied to the company’s variable-rate investment portfolio. Starwood Property has a history of overearning its dividend, lending a high degree of dividend visibility to an investment in the mortgage REIT. Though Starwood Property Trust’s shares are far from being cheap, the premium valuation is justified given its nearly 9 percent covered yield, and dividend upside.
Starwood Property Trust has an excellent reputation in the mortgage REIT industry, and that’s largely due to these factors:
