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REDWOOD TRUST INC - RWT 9 09/01/29 (RWTO) Stock Fundamental Analysis

NYSE:RWTO - New York Stock Exchange, Inc. - US7580758735 - Currency: USD

24.71  +0.66 (+2.74%)

Fundamental Rating

2

RWTO gets a fundamental rating of 2 out of 10. The analysis compared the fundamentals against 65 industry peers in the Mortgage Real Estate Investment Trusts (REITs)" industry. RWTO has a bad profitability rating. Also its financial health evaluation is rather negative. RWTO is valued quite expensively, but it does show have an excellent growth rating.


Dividend Valuation Growth Profitability Health

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1

1. Profitability

1.1 Basic Checks

RWTO had positive earnings in the past year.
RWTO had a negative operating cash flow in the past year.
In multiple years RWTO reported negative net income over the last 5 years.
In the past 5 years RWTO always reported negative operating cash flow.
RWTO Yearly Net Income VS EBIT VS OCF VS FCFRWTO Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 -2B -4B

1.2 Ratios

RWTO has a worse Return On Assets (0.23%) than 60.00% of its industry peers.
RWTO's Return On Equity of 3.59% is in line compared to the rest of the industry. RWTO outperforms 44.62% of its industry peers.
RWTO has a Return On Invested Capital (0.42%) which is comparable to the rest of the industry.
Industry RankSector Rank
ROA 0.23%
ROE 3.59%
ROIC 0.42%
ROA(3y)-0.38%
ROA(5y)-0.94%
ROE(3y)-4.33%
ROE(5y)-8.65%
ROIC(3y)N/A
ROIC(5y)N/A
RWTO Yearly ROA, ROE, ROICRWTO Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 -20 -40

1.3 Margins

The Profit Margin of RWTO (4.31%) is worse than 60.00% of its industry peers.
In the last couple of years the Profit Margin of RWTO has declined.
Looking at the Operating Margin, with a value of 10.26%, RWTO is in line with its industry, outperforming 47.69% of the companies in the same industry.
In the last couple of years the Operating Margin of RWTO has declined.
With a Gross Margin value of 12.54%, RWTO is not doing good in the industry: 80.00% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of RWTO has declined.
Industry RankSector Rank
OM 10.26%
PM (TTM) 4.31%
GM 12.54%
OM growth 3Y-34.74%
OM growth 5Y-12.48%
PM growth 3Y-56.86%
PM growth 5Y-30.4%
GM growth 3Y-21.34%
GM growth 5Y-11.34%
RWTO Yearly Profit, Operating, Gross MarginsRWTO Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 50 -50 -100

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1

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), RWTO is destroying value.
The number of shares outstanding for RWTO has been increased compared to 1 year ago.
The number of shares outstanding for RWTO has been increased compared to 5 years ago.
The debt/assets ratio for RWTO is higher compared to a year ago.
RWTO Yearly Shares OutstandingRWTO Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 20M 40M 60M 80M 100M
RWTO Yearly Total Debt VS Total AssetsRWTO Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 5B 10B 15B

2.2 Solvency

Based on the Altman-Z score of 0.19, we must say that RWTO is in the distress zone and has some risk of bankruptcy.
RWTO has a Altman-Z score of 0.19. This is in the better half of the industry: RWTO outperforms 80.00% of its industry peers.
A Debt/Equity ratio of 14.09 is on the high side and indicates that RWTO has dependencies on debt financing.
RWTO has a worse Debt to Equity ratio (14.09) than 96.92% of its industry peers.
Industry RankSector Rank
Debt/Equity 14.09
Debt/FCF N/A
Altman-Z 0.19
ROIC/WACC0.07
WACC5.59%
RWTO Yearly LT Debt VS Equity VS FCFRWTO Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 5B -5B 10B 15B

2.3 Liquidity

A Current Ratio of 0.25 indicates that RWTO may have some problems paying its short term obligations.
RWTO has a better Current ratio (0.25) than 61.54% of its industry peers.
A Quick Ratio of 0.25 indicates that RWTO may have some problems paying its short term obligations.
RWTO's Quick ratio of 0.25 is fine compared to the rest of the industry. RWTO outperforms 61.54% of its industry peers.
Industry RankSector Rank
Current Ratio 0.25
Quick Ratio 0.25
RWTO Yearly Current Assets VS Current LiabilitesRWTO Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 500M 1B 1.5B 2B

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7

3. Growth

3.1 Past

RWTO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 163.64%, which is quite impressive.
The earnings per share for RWTO have been decreasing by -19.83% on average. This is quite bad
Looking at the last year, RWTO shows a very strong growth in Revenue. The Revenue has grown by 29.69%.
RWTO shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.67% yearly.
EPS 1Y (TTM)163.64%
EPS 3Y-39.69%
EPS 5Y-19.83%
EPS Q2Q%75%
Revenue 1Y (TTM)29.69%
Revenue growth 3Y19.75%
Revenue growth 5Y9.67%
Sales Q2Q%16.25%

3.2 Future

Based on estimates for the next years, RWTO will show a quite strong growth in Earnings Per Share. The EPS will grow by 15.34% on average per year.
The Revenue is expected to grow by 8.89% on average over the next years. This is quite good.
EPS Next Y37.66%
EPS Next 2Y30.74%
EPS Next 3Y15.34%
EPS Next 5YN/A
Revenue Next Year24.4%
Revenue Next 2Y10.83%
Revenue Next 3Y8.89%
Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
RWTO Yearly Revenue VS EstimatesRWTO Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 200M 400M 600M 800M
RWTO Yearly EPS VS EstimatesRWTO Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 0 2 -2 -4

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1

4. Valuation

4.1 Price/Earnings Ratio

RWTO is valuated quite expensively with a Price/Earnings ratio of 42.60.
61.54% of the companies in the same industry are cheaper than RWTO, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 25.82, RWTO is valued quite expensively.
With a Price/Forward Earnings ratio of 27.80, RWTO can be considered very expensive at the moment.
Based on the Price/Forward Earnings ratio, RWTO is valued expensively inside the industry as 80.00% of the companies are valued cheaper.
RWTO's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 21.76.
Industry RankSector Rank
PE 42.6
Fwd PE 27.8
RWTO Price Earnings VS Forward Price EarningsRWTO Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, RWTO is valued a bit cheaper than the industry average as 76.92% of the companies are valued more expensively.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 160.26
RWTO Per share dataRWTO EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 -10 -20 -30 -40

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
RWTO's earnings are expected to grow with 15.34% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.13
PEG (5Y)N/A
EPS Next 2Y30.74%
EPS Next 3Y15.34%

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3

5. Dividend

5.1 Amount

RWTO has a Yearly Dividend Yield of 12.50%, which is a nice return.
RWTO's Dividend Yield is slightly below the industry average, which is at 14.23.
Compared to an average S&P500 Dividend Yield of 2.39, RWTO pays a better dividend.
Industry RankSector Rank
Dividend Yield 12.5%

5.2 History

The dividend of RWTO decreases each year by -10.27%.
RWTO is new to the dividend game and has less than 3 years of track record.
Dividend Growth(5Y)-10.27%
Div Incr Years0
Div Non Decr Years0

5.3 Sustainability

RWTO pays out 234.54% of its income as dividend. This is not a sustainable payout ratio.
DP234.54%
EPS Next 2Y30.74%
EPS Next 3Y15.34%
RWTO Yearly Income VS Free CF VS DividendRWTO Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 -2B -4B
RWTO Dividend Payout.RWTO Dividend Payout, showing the Payout Ratio.RWTO Dividend Payout.PayoutRetained Earnings

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REDWOOD TRUST INC - RWT 9 09/01/29

NYSE:RWTO (5/23/2025, 8:54:08 PM)

24.71

+0.66 (+2.74%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryMortgage Real Estate Investment Trusts (REITs)"
Earnings (Last)04-30 2025-04-30/amc
Earnings (Next)07-30 2025-07-30/amc
Inst Owners79.96%
Inst Owner ChangeN/A
Ins Owners1.17%
Ins Owner ChangeN/A
Market Cap3.29B
Analysts75.38
Price Target31.76 (28.53%)
Short Float %0%
Short Ratio0.23
Dividend
Industry RankSector Rank
Dividend Yield 12.5%
Yearly Dividend0.76
Dividend Growth(5Y)-10.27%
DP234.54%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)2.09%
Min EPS beat(2)-21.87%
Max EPS beat(2)26.06%
EPS beat(4)1
Avg EPS beat(4)-3.13%
Min EPS beat(4)-21.87%
Max EPS beat(4)26.06%
EPS beat(8)1
Avg EPS beat(8)-38.17%
EPS beat(12)2
Avg EPS beat(12)-82.2%
EPS beat(16)5
Avg EPS beat(16)-48.18%
Revenue beat(2)0
Avg Revenue beat(2)-9.57%
Min Revenue beat(2)-14.39%
Max Revenue beat(2)-4.75%
Revenue beat(4)1
Avg Revenue beat(4)-7.86%
Min Revenue beat(4)-15.25%
Max Revenue beat(4)2.94%
Revenue beat(8)4
Avg Revenue beat(8)152.69%
Revenue beat(12)8
Avg Revenue beat(12)208.08%
Revenue beat(16)12
Avg Revenue beat(16)280.13%
PT rev (1m)-4.69%
PT rev (3m)1.03%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-9.8%
EPS NY rev (1m)-9.67%
EPS NY rev (3m)-12.86%
Revenue NQ rev (1m)1.18%
Revenue NQ rev (3m)0.15%
Revenue NY rev (1m)10.14%
Revenue NY rev (3m)5.28%
Valuation
Industry RankSector Rank
PE 42.6
Fwd PE 27.8
P/S 3.33
P/FCF N/A
P/OCF N/A
P/B 2.77
P/tB 2.87
EV/EBITDA 160.26
EPS(TTM)0.58
EY2.35%
EPS(NY)0.89
Fwd EY3.6%
FCF(TTM)-44.09
FCFYN/A
OCF(TTM)-44.09
OCFYN/A
SpS7.42
BVpS8.93
TBVpS8.61
PEG (NY)1.13
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 0.23%
ROE 3.59%
ROCE 0.62%
ROIC 0.42%
ROICexc 0.42%
ROICexgc 0.43%
OM 10.26%
PM (TTM) 4.31%
GM 12.54%
FCFM N/A
ROA(3y)-0.38%
ROA(5y)-0.94%
ROE(3y)-4.33%
ROE(5y)-8.65%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3Y-27.55%
ROICexcg growth 5Y-4.26%
ROICexc growth 3Y-27.68%
ROICexc growth 5Y-4.1%
OM growth 3Y-34.74%
OM growth 5Y-12.48%
PM growth 3Y-56.86%
PM growth 5Y-30.4%
GM growth 3Y-21.34%
GM growth 5Y-11.34%
F-Score3
Asset Turnover0.05
Health
Industry RankSector Rank
Debt/Equity 14.09
Debt/FCF N/A
Debt/EBITDA 147.83
Cap/Depr N/A
Cap/Sales N/A
Interest Coverage 0.12
Cash Conversion N/A
Profit Quality N/A
Current Ratio 0.25
Quick Ratio 0.25
Altman-Z 0.19
F-Score3
WACC5.59%
ROIC/WACC0.07
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)163.64%
EPS 3Y-39.69%
EPS 5Y-19.83%
EPS Q2Q%75%
EPS Next Y37.66%
EPS Next 2Y30.74%
EPS Next 3Y15.34%
EPS Next 5YN/A
Revenue 1Y (TTM)29.69%
Revenue growth 3Y19.75%
Revenue growth 5Y9.67%
Sales Q2Q%16.25%
Revenue Next Year24.4%
Revenue Next 2Y10.83%
Revenue Next 3Y8.89%
Revenue Next 5YN/A
EBIT growth 1Y97.69%
EBIT growth 3Y-21.85%
EBIT growth 5Y-4.01%
EBIT Next Year-2.46%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-190.82%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-190.82%
OCF growth 3YN/A
OCF growth 5YN/A