30 Day Dividends Trade Open: Blackstone Mortgage Trust
This is a buy recommendation for a short-term trade in Blackstone Mortgage Trust Inc. (NYSE:BXMT). BXMT is one of the high-yield stocks that I track for between ex-dividend date price swings. The stock went ex-dividend on September 28, and the closing price on Friday, October 7 was 6% below the close on the ex-dividend date. From this value, the expectation is that the BXMT share value will at some point climb as the next dividend date approaches and buyers come in to earn the next dividend.
Blackstone Mortgage Trust will announce its next dividend in mid-December with an end of December ex-dividend date. The BXMT quarterly dividend yield is 2.2%, one-quarter of the annual dividend rate of 8.8%. Our target gain will be three times the quarterly dividend or 6.6% over the next two months. I will set the target price based on the October 10 closing price for BXMT.
Note: Blackstone Mortgage Trust is also a Dividend Hunter recommended stock. I intend for Dividend Hunter recommendations to be buy-and-hold investments to earn an ongoing dividend stream. This 30 Day Dividends buy recommendation would be for additional shares (if you already own some BXMT) of the stock and should be viewed as a shorter-term position.
Recommendation: Buy BXMT up to $28.55. Target price will be approximately $30.40. The position will be closed when the target is reached or no later than the day before the next ex-dividend date.