
Redwood Trust (RWT) Stock Forecast & Price Target
Redwood Trust (RWT) Analyst Ratings
Bulls say
Redwood Trust Inc. is positioned favorably due to anticipated lower interest rates and trends in bank regulations, suggesting a strong tailwind for the company as it approaches FY26. The firm's mortgage banking income is expected to remain robust, having successfully distributed $3.4 billion in whole loan sales during the last quarter, which represents 50% of their fundings. Additionally, the company offers a stable 12% dividend, with potential for mark-to-market appreciation linked to decreasing interest rates and tightening credit spreads, which could further enhance its earnings outlook.
Bears say
Redwood Trust's stock outlook is negative primarily due to the ongoing challenges arising from high financing costs that exceed those of its peers, which can hinder returns for shareholders. Additionally, the company's significant reliance on its Redwood Investments segment is at risk, evidenced by a decrease in the book value from $7.49 to $7.35 per share and lower-than-expected performance in investment fair value and mortgage banking income. Furthermore, the portfolio's current focus on workout mode, coupled with a substantial capital exposure of $407 million to legacy HEI and bridge investments, poses risks to overall earnings and return on equity amidst management execution concerns.
This aggregate rating is based on analysts' research of Redwood Trust and is not a guaranteed prediction by Public.com or investment advice.
Redwood Trust (RWT) Analyst Forecast & Price Prediction
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