Value
8.8/10data confidence 50%| Component | Sub-score |
|---|---|
| P/S | 7.5 |
| p ocf | 9.4 |
| Analyst target | 9.0 |
- ▸P/OCF: 5.8x (FFO proxy — REITs gated off P/E)
- ▸Attractively valued
TRTX · Why this verdict
Why TPG RE Finance Trust (TRTX) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score5.7/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
TPG RE Finance Trust is a mortgage REIT trading at an attractive 5.2x price-to-operating-cash-flow with 32% upside to the analyst target, but shrinking revenue, a confirmed downtrend and earnings in 2 days argue for patience.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The stock is attractively valued at 5.2x price to operating cash flow, with a 48% margin of safety and a value score of 8.9 out of 10. Valuation breakdown | Valuation re-rates as price to operating cash flow moves above 7x while earnings hold. | →Stable |
| CounterMortgage REITs often trade at low multiples for good reason; cheap valuation can be a value trap if loan credit deteriorates. | ||
The $8.30 analyst target is 32.2% above the $6.28 price, against 10.8% downside to the stop, a reward-to-risk of about 3.0. Targets | Price rises toward the analyst target over 12 months as sentiment on real estate recovers. | →Stable |
| CounterOnly 6 analysts cover the stock so the signal is dampened, and targets in an out-of-favor sector can be cut quickly. | ||
Revenue is declining 12% year over year, and the loan book is concentrated 100% in first mortgage loans, a high-severity concentration risk. Bear case | Revenue decline narrows to less than 5% as the loan portfolio stabilizes. | ↓Deteriorating |
| CounterShrinking revenue and a single-product book leave no diversification if commercial real estate credit worsens. | ||
The stock trades below its 200-day average, which is falling 3.3% per 30 days, though volume accumulation and improving momentum suggest a recovery setup. Momentum breakdown | Price reclaims the 200-day moving average while on-balance volume keeps rising. | ↑Improving |
| CounterA death cross with a falling average often precedes further declines; the recovery signal is weak with a momentum score of only 5.6. | ||
Earnings are due in 2 days after a weak record of 0 beats and 2 misses, while a 15.3% dividend yield is the main income support. Catalyst breakdown | EPS meets or beats estimates in the next 2 quarters and the dividend is maintained. | ↑Improving |
| CounterA 15.3% yield implies the market doubts it is sustainable, and a miss could force a cut. | ||
The stock is attractively valued at 5.2x price to operating cash flow, with a 48% margin of safety and a value score of 8.9 out of 10.
→StableValuation breakdown
- Expectation
- Valuation re-rates as price to operating cash flow moves above 7x while earnings hold.
CounterMortgage REITs often trade at low multiples for good reason; cheap valuation can be a value trap if loan credit deteriorates.
The $8.30 analyst target is 32.2% above the $6.28 price, against 10.8% downside to the stop, a reward-to-risk of about 3.0.
→StableTargets
- Expectation
- Price rises toward the analyst target over 12 months as sentiment on real estate recovers.
CounterOnly 6 analysts cover the stock so the signal is dampened, and targets in an out-of-favor sector can be cut quickly.
Revenue is declining 12% year over year, and the loan book is concentrated 100% in first mortgage loans, a high-severity concentration risk.
↓DeterioratingBear case
- Expectation
- Revenue decline narrows to less than 5% as the loan portfolio stabilizes.
CounterShrinking revenue and a single-product book leave no diversification if commercial real estate credit worsens.
The stock trades below its 200-day average, which is falling 3.3% per 30 days, though volume accumulation and improving momentum suggest a recovery setup.
↑ImprovingMomentum breakdown
- Expectation
- Price reclaims the 200-day moving average while on-balance volume keeps rising.
CounterA death cross with a falling average often precedes further declines; the recovery signal is weak with a momentum score of only 5.6.
Earnings are due in 2 days after a weak record of 0 beats and 2 misses, while a 15.3% dividend yield is the main income support.
↑ImprovingCatalyst breakdown
- Expectation
- EPS meets or beats estimates in the next 2 quarters and the dividend is maintained.
CounterA 15.3% yield implies the market doubts it is sustainable, and a miss could force a cut.
Per-dimension breakdown
Quality
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 1.4 |
| ROA | 0.7 |
| Gross margin | 10.0 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Current ratio | 5.0 |
| Moat | 4.6 |
| Piotroski F | 7.8 |
- ▸Strong margins: 38%
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 7/9
Growth
5.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 0.0 |
| EPS growth | 10.0 |
- ▸Declining revenue: -32%
Momentum
6.0/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.3 |
| MACD | 8.4 |
| OBV | 10.0 |
| MA position | 4.0 |
| Volume | 4.5 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope -3.5%/30d — confirmed downtrend
Sentiment
6.9/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 4.9 |
| Analyst rating | 6.6 |
| Price target | 9.4 |
- ▸Light analyst coverage (6.0) — signal dampened
- ▸Analyst upside: 47%
Insider
5.5/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.9 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
4.0/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.9 |
| quality rank | 5.2 |
| growth rank | 0.8 |
Technical
1.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 0.1 |
| 52w position | 5.2 |
Risk (lower is worse)
3.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 5.3 |
| days to cover | 5.4 |
| volatility | 4.1 |
| implied vol | 0.3 |
| debt equity | 0.9 |
- ▸High IV: 78%
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
3.9/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 0.0 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
| dividend safety | 5.5 |
| news activity | 8.0 |
- ▸Earnings concerns: 0B/3M
- ▸Dividend: 14.8%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:6.0>=5.5
- ASYMMETRY:2.0>=1.5
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:110d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (0)
none
Warning (1)
- DEATH_CROSS:momentum=6.0>=5.0 recovering
Reward-to-Risk
2.04
Upside
+27.9%
Downside
13.7%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 67
EdgeSector Rotation — Real Estate sector out of favor, value=8.8
SuitabilityAggressive — MCap $0.5B<$5B
Investment implication
The F-path SELL output reflects an overall score of 4.5 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 8.8) was not enough to lift the adjusted overall above the threshold. Current asymmetry R:R is 2.04 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 8.8, Sentiment at 6.9, and Quality at 6.2; the weakest are Technical at 1.8, Risk (lower is worse) at 3.2, and Catalyst at 3.9. The V9 engine cleared all gates with 1 warning, producing an asymmetric reward-to-risk of 2.04 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Attractive Cash Flow Valuation
Trip ifPrice to operating cash flow exceeds 9x from the current 5.2x without growth in cash flow.
- P2Analyst Target Upside
Trip ifPrice falls more than 10.8% to the $5.59 stop level.
- P3Declining Revenue Single Product
Trip ifRevenue decline widens to more than 20% YoY from the current -12%.
- P4Confirmed Downtrend Recovery Setup
Trip ifMomentum score falls below 4.0 from 5.6 while price stays below the 200-day moving average.
- P5Earnings Risk And Dividend Sustainability
Trip ifEPS surprise stays below 0% for 2 consecutive quarters or the dividend is cut by more than 25%.