UPDATE: Stifel Nicolaus Upgrades Northstar Realty Finance Corp. to Buy, Names $10.50 PT on Multiple Opportunities Ahead

In a report published Monday, Stifel Nicolaus analyst Joshua Barber upgraded the rating on

from Hold to Buy, and named a $10.50 price target. In the report, Stifel Nicolaus noted, “We are upgrading NorthStar shares to a Buy rating and establishing a $10.50 target price. NorthStar shares have fallen 15% over the past three weeks (compared to an S&P500 decline of less than 1%) after a strong run and partially due to the rising U.S. 10 year Treasury. However, the shares today trade at less than 9x cash flow, a sizable discount to our $9.25 NAV estimate (which we think could have potential upside over time), and offer an 9% dividend yield, which we expect to grow in 2013. We believe NorthStar has transformed itself into a diversified, go-anywhere real estate investor rather than a mortgage-focused REIT. While the company is still involved in CRE financing markets, we believe its rapidly expanding asset management business and recent acquisitions of real estate private equity stakes as well as manufactured housing and apartment assets have changed NRF and should result in a different risk profile and better multiples and valuation over time.” Northstar Realty Finance Corp. closed on Friday at $8.43.