A key level of resistance has formed in the chart of TPG RE Finance Trust Inc. (TRTX). If that level is broken, a breakout could occur.
TRTX is a commercial real estate finance company. It originates, acquires, and manages commercial mortgage loans and other commercial real estate-related debt instruments.
The company has a portfolio of commercial mortgage loans worth an aggregate total of $5.5 billion. TRTX saw big losses in Q1 due to the pandemic, but has since recovered, with revenues in Q3 up 9% year-over-year. As a REIT, it currently has a dividend yield of 7.5%.
As of the end of the last quarter, the company had $225.6 million in cash. Its revenues are expected to be down 1.5% year over year this quarter, while earnings are estimated to be down 31.8%. Next quarter though, EPS is expected to rise 111.8%. The stock is undervalued with a trailing P/E of 11.24.
The stock has shown bearish long-term momentum, but flat near-term performance. This has led to a “Neutral” rating in our POWR Ratings system.
Take a look at the 1-year chart of TRTX below with my added notations:
Chart of TRTX provided by TradingView
During the past eight months, TRTX has formed a key level of resistance around the $11 (red) mark. The stock has tested that level multiple times since its April bottom, and it is currently sitting under that level again. A solid close above $11 should lead to higher prices for TRTX.
A long trade could be entered on a breakthrough of the $11 resistance level.
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TRTX shares were unchanged in premarket trading Wednesday. Year-to-date, TRTX has gained 0.28%, versus a 1.86% rise in the benchmark S&P 500 index during the same period.
About the Author: christian
Christian is an expert stock market coach at the Adam Mesh Trading Group who has mentored more than 4,000 traders and investors. He is a professional technical analyst that is a certified Chartered Market Technician (CMT), which is a designation awarded by the CMT Association. Christian is also the author of the daily online newsletter Todays Big Stock. More…
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