RWT$6.00
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Powered by LiveAIOverall Analysis
NeutralRedwood Trust shows mixed signals. Its fundamental profile as a REIT is stable with consistent dividends, but current market conditions and its specific business model (mortgage banking) present moderate risks. Technicals suggest a bearish short-term trend, while its thematic positioning in housing and real estate is generally positive but faces interest rate sensitivity.
Thematic
Redwood Trust operates within the real estate and mortgage sectors, which are inherently tied to economic cycles, interest rates, and housing demand. Its focus on residential and multifamily lending provides exposure to these trends.
Fundamental
Redwood Trust exhibits a stable financial position with significant assets and liabilities typical for a financial institution. Profitability has been volatile in recent years, impacted by market conditions, but it offers a substantial dividend yield.
Technical
The stock has experienced a notable decline, trading below key moving averages and exhibiting weak momentum indicators across shorter timeframes. Support levels need to be closely watched.
| Factor | Score |
|---|---|
| Housing Market Demand | 75 |
| Interest Rate Sensitivity | 50 |
| Multifamily Real Estate Trends | 70 |
| Regulatory Landscape (REITs) | 80 |
| Mortgage Banking Evolution | 65 |
| Factor | Score |
|---|---|
| Valuation | 45 |
| Profitability | 70 |
| Growth | 75 |
| Balance Sheet Health | 30 |
| Cash Flow | 10 |
| Dividend Yield | 90 |
| Factor | Score |
|---|---|
| Trend Analysis | 40 |
| Momentum | 50 |
| Volume Confirmation | 60 |
| Support & Resistance | 65 |
| Short-term Oscillators (15m) | 60 |
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Powered by LiveAIBullish Points (5)
Positive EPS Surprise Trend
The company has exceeded earnings per share (EPS) estimates in the latest reported quarter (2024 Q4) with a surprise of 27.32%, following a mixed trend in prior quarters.
Potentially Attractive P/E Ratio for Growth
The trailing P/E ratio of 33.0, while seemingly high, needs to be considered alongside the company's growth prospects. The Price/Sales (PS) ratio of 4.3 (TTM) suggests market valuation relative to revenue.
Bearish Points (6)
Inconsistent EPS Performance
Recent quarterly EPS has shown significant volatility, with negative surprises in Q1 2025 (-21.09%) and Q2 2025 (-16.04%), alongside a negative result in Q4 2023 (-42.44%).
High P/E Ratio Relative to Recent Profitability
The trailing P/E of 33.0 is high when considering the negative net income in 2023 (-$2.274M) and 2022 (-$163.52M). The P/E for 2024 is reported as 15.1, showing a significant swing back to profitability.
Calendar
June 2025
23
Ex-Dividend Date
June 2025
30
Next Dividend Date
July 2025
30
Next Earnings Date
H: $0.22
A: $0.18
L: $0.11
H: 37.00M
A: 30.97M
L: 28.29M
Profile
Redwood Trust, Inc., together with its subsidiaries, operates as a specialty finance company in the United States. It operates through three segments: Sequoia Mortgage Banking, CoreVest Mortgage Banking, and Redwood Investments. The Residential Consumer Mortgage Banking segment operates a mortgage loan conduit that acquires residential loans from third-party originators for subsequent sale, securitization, or transfer to its investment portfolio. This segment also offers derivative financial instruments to manage risks associated with residential loans. Its CoreVest Mortgage Banking segment operates a platform that originates business purpose loans to investors in single-family and multifamily residential properties and bridge loans for subsequent securitization, sale, or transfer into its investment portfolio. The Redwood Investments segment invests in securities retained from residential consumer and investor securitization activities, and business purpose lending bridge loans, as well as residential mortgage-backed securities issued by third parties, Freddie Mac K-Series multifamily loan securitizations and reperforming loan securitizations, servicer advance investments, home equity investments, and other housing-related investments. The company is elected to be taxed as a real estate investment trust (REIT) for federal income tax purposes. Redwood Trust, Inc. was incorporated in 1994 and is headquartered in Mill Valley, California.
Seasonals
Price Target
7.12 USD
The 39 analysts offering 1 year price forecasts for RWT have a max estimate of 8.50 and a min estimate of 6.50.
Debt Level and Coverage
Financial Position Analysis
Ownership
Capital Structure
Valuation - Summary
Valuation - Ratios
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