Why Granite Point Mortgage Trust Rocketed Nearly 17% Out of the Gate Today

Shares of mortgage real estate investment trust (REIT) Granite Point Mortgage Trust (NYSE: GPMT) jumped nearly 17% at the open of trading on Sept. 29. By 10 a.m. EDT, the shares had given back much of that gain but were still holding onto a roughly 10% advance. It was Granite Point's news release after the close on Monday that got investors excited.

There were two parts to that press release. One was basic business information, most of which was very positive. The highlight was that more than 99% of the REIT's borrowers paid on time in August and September. Other facts noted were that the company had cash of $357 million; it had secured a $300 million, five-year term loan facility (of which it has already drawn $225 million, perhaps turning this item into something of a mix of a positive and a negative); and it had funded roughly $52 million on existing loan commitments while also receiving $185 million worth of repayments in the third quarter. All well and good, but not really enough to lead to such a large spike in the stock price.

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Source Fool.com