Goldman Sachs Lowers PT to $19 On CLNY, Despite Second Offering

Goldman Sachs has lowered its price target from $20 to $19 and maintains its Neutral rating on Colony Financial Inc

, despite the company's recent announcement of a second offering of 15.4 mn shares for aggregate net proceeds of $272 mn. In the report, Goldman Sachs writes, “We maintain our Neutral rating and believe CLNY's secondary offering will largely appear more dilutive vs. our previous estimates given differences in timing. Specifically we lower our 2011/12/13 EPS estimates to $1.50/ $2.00/$2.00 from $1.85/$2.07/$2.05. Similarly we lower our DCF target to $19 from $20 to account for the inclusion and timing of CLNY's new shares. We view this capital raise as the logical next step for CLNY as the company grows in scale. The shift to performing assets seems prudent at this time as it should grow CLNY's recurring cash flows and potentially provide a balance sheet with wider financing options.” CLNY closed at $18.43 yesterday.