Keefe, Bruyette & Woods Lowers Redwood Trust (NYSE:RWT) Price Target to $5.50

Redwood Trust (NYSE:RWT) had its target price cut by research analysts at Keefe, Bruyette & Woods from $6.00 to $5.50 in a note issued to investors on Wednesday,Benzinga reports. The brokerage presently has an “outperform” rating on the real estate investment trust’s stock. Keefe, Bruyette & Woods’ target price suggests a potential upside of 17.40% from the company’s current price.

A number of other brokerages also recently weighed in on RWT. BTIG Research reaffirmed a “buy” rating and set a $6.00 price target on shares of Redwood Trust in a report on Tuesday. Zacks Research lowered Redwood Trust from a “hold” rating to a “strong sell” rating in a research note on Tuesday, July 21st. JonesTrading lowered their price target on Redwood Trust from $6.25 to $6.00 and set a “buy” rating for the company in a report on Tuesday. JPMorgan Chase & Co. reduced their price objective on Redwood Trust from $6.50 to $6.00 and set an “overweight” rating on the stock in a research note on Friday, July 17th. Finally, Weiss Ratings reiterated a “sell (d)” rating on shares of Redwood Trust in a research report on Wednesday, June 24th. Six investment analysts have rated the stock with a Buy rating, two have assigned a Hold rating and two have issued a Sell rating to the company’s stock. According to data from MarketBeat, Redwood Trust currently has an average rating of “Hold” and a consensus target price of $6.00.

Redwood Trust Stock Performance

NYSE:RWT opened at $4.68 on Wednesday. The company has a market cap of $586.66 million, a price-to-earnings ratio of -6.01 and a beta of 1.37. Redwood Trust has a fifty-two week low of $4.19 and a fifty-two week high of $6.97. The company has a debt-to-equity ratio of 28.42, a quick ratio of 59.63 and a current ratio of 59.63. The stock has a fifty day moving average price of $5.05 and a 200-day moving average price of $5.52.

Redwood Trust (NYSE:RWT) last issued its quarterly earnings results on Tuesday, July 28th. The real estate investment trust reported $0.25 EPS for the quarter, topping analysts’ consensus estimates of $0.23 by $0.02. Redwood Trust had a positive return on equity of 14.53% and a negative net margin of 7.23%.The company had revenue of $78.50 million for the quarter, compared to analysts’ expectations of $89.45 million. As a group, equities analysts anticipate that Redwood Trust will post 1.07 EPS for the current fiscal year.

Institutional Investors Weigh In On Redwood Trust

Hedge funds have recently modified their holdings of the company. Evanson Financial LLC bought a new stake in Redwood Trust during the 2nd quarter worth $66,000. PVG Asset Management Corp acquired a new stake in shares of Redwood Trust during the second quarter valued at about $592,000. Empowered Funds LLC acquired a new stake in shares of Redwood Trust during the first quarter valued at about $255,000. Optiver Holding B.V. boosted its stake in shares of Redwood Trust by 2,034.5% during the first quarter. Optiver Holding B.V. now owns 10,779 shares of the real estate investment trust’s stock valued at $60,000 after purchasing an additional 10,274 shares in the last quarter. Finally, Bank of America Corp DE increased its stake in shares of Redwood Trust by 66.4% in the first quarter. Bank of America Corp DE now owns 395,286 shares of the real estate investment trust’s stock valued at $2,218,000 after buying an additional 157,795 shares during the period. Institutional investors and hedge funds own 74.34% of the company’s stock.

Key Headlines Impacting Redwood Trust

Here are the key news stories impacting Redwood Trust this week:

• Positive Sentiment: Analysts remain bullish: JonesTrading lowered its price target modestly from $6.25 to $6.00 but maintained a “buy” rating. BTIG Research also reaffirmed its “buy” rating with a $6.00 target, implying roughly 28% potential upside from recent levels. Benzinga analyst rating reports
• Positive Sentiment: Mortgage banking remained a key strength: Production exceeded $8 billion for the second consecutive quarter, while Mortgage Banking platforms generated $40.1 million in GAAP net income, up 9% sequentially. Redwood also declared its regular $0.18 quarterly dividend and reported $192 million in unrestricted cash. Redwood Trust Q2 results
• Neutral Sentiment: Adjusted earnings were mixed: Redwood reported quarterly EPS of $0.25, above one analyst consensus estimate of $0.23 and up from $0.18 a year earlier, but below the Zacks consensus estimate of $0.26. This divergence may contribute to uncertainty over the quality and sustainability of the quarter’s earnings. Zacks Redwood Trust earnings report
• Negative Sentiment: GAAP results and revenue raised concerns: Redwood posted a $2.9 million GAAP net loss, or $0.03 per share. Revenue of $78.5 million also fell short of the $89.45 million consensus estimate, while book value per share declined to $6.90 from $7.12 in the prior quarter. These factors likely explain the selling pressure despite the mortgage-banking gains. TipRanks Redwood Trust Q2 results

About Redwood Trust

Redwood Trust, Inc (NYSE:RWT) is a publicly traded real estate investment trust specializing in the U.S. residential mortgage market. Headquartered in Mill Valley, California, the company focuses on investing in a diversified portfolio of residential mortgage assets, including whole loans, agency and non-agency mortgage-backed securities, and structured credit products.

The company’s core activities encompass the acquisition, financing, and management of prime residential mortgage whole loans and mortgage-backed securities.