Summary

The quiet period is set to expire for KKR Real Estate Finance Trust on May 30.

After this point, underwriters will be able to release reports and recommendations for the first time since the IPO.

We predict this will lead to a stock boost as more investors become aware of the opportunity with this newly public REIT.

The 25-day quiet period on KKR Real Estate Finance Trust (Pending:KREF) will end on May 30.

After this point, the firm’s IPO underwriters will be able to publish reports and recommendations on KKR Real Estate Finance Trust for the first time since the company’s IPO. KKR Real Estate is a real estate investment trust (REIT) that originates and acquires senior loans secured by commercial real estate assets.

Our own firm has studied price movement around quiet period expirations and found above market returns of approximately 2-3% between in the days (-5, +2), surrounding the quiet period expiration date (day 0), which in this case is May 30.

We first covered KKR Real Estate ahead of its IPO on May 4 on our IPO Insights Platform. Then, we recommended investors consider an allocation given its strong leadership and growth. We view the upcoming quiet period expiration event as a second buying opportunity for investors and suggest those interested in REITs consider purchasing shares before May 30.

The company is backed by a strong syndicate, including: KKR Capital Markets, Morgan Stanley, Wells Fargo Securities, Barclays Capital, Goldman Sachs, J.P. Morgan Securities, and Keefe Bruyette and Woods. We predict these underwrites will be anxious to release reports and recommendations once restrictions are lifted, likely boosting the stock price further.

Early Market Performance

KKR Real Estate went public on May 4, and raised $210M through its offer of 10.25M shares. This was slightly more shares than initially expected, given high demand. However, shares priced at $20.50, on the low end of its expected price range of $20.50 to $21.50. The stock closed at $22.33 on its first day of trading, a 8% increase. Since then the share price has ranged from a low of $21.63 on May 10, and a high of $22.86 on May 19. The stock currently at $22.33 (market session May 24).

Business Overview

KKR Real Estate Finance Trust