Redwood Trust (RWT) Surpasses Q3 Earnings Estimates
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 31 2024
0mins
Source: NASDAQ.COM
Earnings Performance: Redwood Trust (RWT) reported quarterly earnings of $0.18 per share, exceeding estimates and showing a year-over-year increase from $0.09 per share, although revenues of $25.5 million fell short of expectations.
Future Outlook: The company's favorable earnings estimate revisions have led to a Zacks Rank #2 (Buy), suggesting potential outperformance in the near future, while industry trends may also impact stock performance.
Get Free Real-Time Notifications for Any Stock
Monitor tickers like RWT with instant alerts to capture every critical market movement.
Sign up for free to build your custom watchlist and receive professional-grade stock notifications.
Analyst Views on RWT
Wall Street analysts forecast RWT stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for RWT is 7.50 USD with a low forecast of 6.00 USD and a high forecast of 9.50 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
8 Analyst Rating
5 Buy
3 Hold
0 Sell
Moderate Buy
Current: 5.860
Low
6.00
Averages
7.50
High
9.50
Current: 5.860
Low
6.00
Averages
7.50
High
9.50
About RWT
Redwood Trust, Inc. is a specialty finance company focused on several distinct areas of housing credit. The Company's segments include Sequoia Mortgage Banking, CoreVest Mortgage Banking, and Redwood Investments. The Sequoia Mortgage Banking segment consists of a mortgage loan conduit that acquires residential loans from third-party originators for subsequent sale to whole loan buyers, securitization through its SEMT (Sequoia) private-label securitization program, or transfer into its investment portfolio. The CoreVest Mortgage Banking segment consists of a platform that originates business-purpose lending loans for subsequent securitization, sale, or transfer into its investment portfolio. The Redwood Investments segment consists of organic investments sourced through the Company's mortgage banking operations. Additionally, through RWT Horizons, its venture investing initiative, the Company invests in early-stage companies.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Redwood Trust Announces Tax Information for 2025 Dividends
- Dividend Distribution Overview: Redwood Trust expects that 39% of its 2025 common stock dividend distributions will be classified as ordinary income, 2% as qualified dividends, and 59% as return of capital, which will impact shareholders' tax filings and cash flow.
- Preferred Stock Distribution Details: The preferred stock dividends for 2025 are anticipated to be 96% ordinary income and 4% qualified dividends, necessitating shareholders to plan their taxes accordingly to mitigate potential tax burdens.
- REIT Tax Implications: As Redwood operates as a Real Estate Investment Trust (REIT), the portion of qualified dividend income available to shareholders is limited, which may affect their overall tax liabilities and investment returns.
- Investor Consultation Recommendation: The company advises shareholders to consult tax advisors to ensure their tax filings align with Redwood's dividend distribution information, thereby avoiding potential tax issues from misreporting.
Continue Reading
Redwood Trust Announces 2025 Dividend Tax Information
- Dividend Distribution Overview: Redwood Trust expects that 39% of its 2025 common stock dividend distributions will be classified as ordinary income, 2% as qualified dividends, and 59% as return of capital, impacting shareholders' tax filings and cash flow.
- Preferred Stock Dividend Details: The preferred stock dividends for 2025 are anticipated to be 96% ordinary income and 4% qualified dividends, which shareholders must report on their 2025 federal tax returns, affecting their tax liabilities.
- Tax Deduction Opportunities: Individual taxpayers may benefit from a 20% deduction on ordinary income REIT dividends under Section 199A, provided they meet specific holding period requirements, potentially offering tax advantages to shareholders.
- REIT Structure Implications: Due to Redwood's classification as a REIT, the portion of dividends classified as qualified dividends is limited, and corporate shareholders generally do not qualify for the dividend-received deduction, which may influence their investment strategies.
Continue Reading