Market Overview

Maxim Highlights Manhattan Bridge Capital, A Niche REIT With A Rising Dividend


Manhattan Bridge Capital Inc. (NASDAQ: LOAN) is a risk-averse, niche mortgage lender with increasing dividend, Maxim Group said in a Thursday note.

The Analyst

Maxim analyst Michael Diana initiated coverage of Manhattan Bridge Capital with a Buy rating and $7.50 price target.

The Thesis

Manhattan Capital lends to small real estate developers in the New York City metropolitan area having a pressing need for bridge capital to acquire, improve and sell residential real estate, Diana said in a note. The analyst noted the company is taxed as a REIT.

Giving details of the company's business model, Diana said it has thorough and conservative underwriting and intimate knowledge of the real estate markets. The company offers short-term loans and interest-only loans, with a balloon payment at maturity, he said.

The analyst said the company customizes loan features, offering flexibility, responds quickly to prospective borrowers and also funds the loan quickly, once it is approved. The company offers an exit strategy for the loan and also does diligent loan monitoring and servicing.

Maxim also highlighted the company's excellent credit quality, hands-on management, competitive edge and attractive valuation. The company stands out from "hard money lenders" due to its reliability and dependability, the firm said.

The firm said shares should be trading at a premium due to the its less leverage, higher profitability, higher credit quality, reduced earnings volatility and dividend growth.

The Price Action

Shares of Manhattan Bridge Capital are down 23 percent in the year-to-date period.

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Latest Ratings for LOAN

Apr 2018Maxim GroupMaintainsBuyBuy
Dec 2017Maxim GroupInitiates Coverage OnBuy
May 2017Compass PointInitiates Coverage OnBuy

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