We recently published a list of 10 Most Undervalued REIT Stocks to Invest In Now. In this article, we are going to take a look at where Blackstone Mortgage Trust, Inc. (NYSE:BXMT) stands against other most undervalued REIT stocks to invest in now.

Where is the Real Estate Sector Heading?

According to the National Association of Realtors, sales of previously owned homes in February increased 4.2% from January while they were 1.2% lower year-over-year. Home buyers are slowly moving into the market although mortgage rates have not changed much. Although the market is still tight, it is witnessing more inventory and choices, with the inventory at February end standing at 1.24 million units thereby representing a 17% rise year-over-year. The tight supply is still driving home prices up since the median price of a home sold in the month of February was 3.8% higher, as compared to last year.

Lawrence Yun, NAR’s chief economist, previously appeared on CNBC to give insights on the state of the housing market. In his opinion, if inflation comes down due to deregulation policies despite the tariff conditions or more home construction occurs with the federal government opening up for more development, the market might see lower mortgage rates along with the Fed rate cut. Simultaneously, the Federal Reserve decided to hold the interest rates steady amidst uncertainties around tariffs.

Logan Mohtashami, HousingWire lead analyst, thinks the cure for tariffs is lower mortgage rates. In an interview with CNBC, he said that if mortgage rates go down and new home sales start to grow, the builder would find a way to sell homes and build homes. Although builder sentiment has recently fallen considering their profit margins are stressed amidst tariffs, this sentiment tends to increase with rates going down.

Our Methodology

In order to compile a list of the 10 most undervalued REIT stocks to invest in now, we first used a stock screener to shortlist REIT stocks trading at a forward P/E of less than 15, as of March 25. From this list, we selected the top 10 stocks with the highest number of hedge fund holders, as of Q4 2024. The 10 most undervalued REIT stocks to invest in now have been arranged in ascending order of the number of hedge funds that disclosed stakes in them at the end of Q4 2024.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

An iconic skyline with one of the company's iconic REITs in the foreground.

Blackstone Mortgage Trust, Inc. (NYSE:BXMT)

Number of Hedge Fund Holders: 21

Forward P/E: 13.77

Blackstone Mortgage Trust, Inc. (NYSE:BXMT) is a publicly traded commercial mortgage real estate investment trust that originates senior loans on commercial real estate in North America, Europe, and Australia. The REIT’s portfolio comprises primarily of senior loans secured by high-quality, institutional assets situated in major markets and sponsored by experienced real estate investment owners and operators.

Blackstone Mortgage Trust, Inc. (NYSE:BXMT) is managed by Blackstone, the world’s largest owner of commercial real estate having total assets under management of more than $1.1 trillion and hence, the REIT remains uniquely positioned to capture the real estate debt market opportunity. In the prevailing environment, Blackstone Mortgage Trust, Inc. (NYSE:BXMT) is capitalizing on an attractive market environment by boosting new investment activity and continued loan resolution and repayment momentum. The REIT had robust 2024 repayments of $5.2 billion. The robust repayment activity led to a quarter-over-quarter decrease in debt-to-equity ratio for the REIT from 3.8x to 3.5x. Simultaneously, investment activity accelerated with over $2 billion of new loan originations closed or in closing in Q1 2025 to date, as of December 31, 2024.

Overall, BXMT ranks 4th on our list of most undervalued REIT stocks to invest in now. While we acknowledge the potential of BXMT as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued AI stock that is more promising than BXMT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. This article is originally published at Insider Monkey.