PennyMac Financial Services (NYSE:PFSI) Posts Earnings Results, Misses Estimates By $1.26 EPS

PennyMac Financial Services (NYSE:PFSI) announced its earnings results on Thursday. The real estate investment trust reported $1.97 EPS for the quarter, missing the consensus estimate of $3.23 by ($1.26), FiscalAI reports. The business had revenue of $538.01 million for the quarter, compared to the consensus estimate of $639.81 million. PennyMac Financial Services had a net margin of 25.21% and a return on equity of 11.69%. The firm’s revenue for the quarter was up 14.4% on a year-over-year basis. During the same quarter in the previous year, the company earned $1.95 EPS.

Here are the key takeaways from PennyMac Financial Services’ conference call:

• PFSI reported a strong 2025 full year with pretax income up 38%, net income up 61%, a 12% ROE, book value per share +11%, production volumes +25% and servicing UPB +10%, driven by solid operational performance across both segments.
• Q4 net income was $107 million ($1.97 EPS) but annualized ROE fell to 10% as market prepayment speeds and MSR runoff accelerated materially and increased origination competition kept production margins from fully offsetting the servicing impact.
• PennyMac is accelerating deployment of its AI-enabled loan origination system Vesta (on track for full rollout in Q1), which management says has cut loan officer time ~50%, reduced end-to-end processing ~25%, lowered per-loan origination costs ~25% and should materially increase capacity and scalable production income.
• Management took capital and risk actions—selling roughly $24 billion of low-rate government MSRs to free capital for higher-yield originations, raising its hedge ratio to ~100%, and ending Q4 with ~$4.6 billion of liquidity and leverage metrics within targeted ranges.

PennyMac Financial Services Price Performance

Shares of NYSE PFSI opened at $149.71 on Friday. PennyMac Financial Services has a twelve month low of $85.74 and a twelve month high of $160.36. The company has a quick ratio of 0.36, a current ratio of 0.36 and a debt-to-equity ratio of 3.01. The firm has a market capitalization of $7.78 billion, a P/E ratio of 16.13, a P/E/G ratio of 0.67 and a beta of 1.57. The stock’s 50-day simple moving average is $137.97 and its two-hundred day simple moving average is $123.00.

PennyMac Financial Services Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Thursday, February 26th. Shareholders of record on Monday, February 16th will be paid a $0.30 dividend. This represents a $1.20 dividend on an annualized basis and a yield of 0.8%. The ex-dividend date is Friday, February 13th. PennyMac Financial Services’s dividend payout ratio is currently 12.93%.

Trending Headlines about PennyMac Financial Services

Here are the key news stories impacting PennyMac Financial Services this week:

• Positive Sentiment: PennyMac reported full‑year strength and book value improvement (book value per share rose to $82.77), which supports long‑term capital resilience. PennyMac Q4 2025 Earnings Call Highlights
• Positive Sentiment: The board declared a $0.30 quarterly dividend (payable Feb 26; ex‑date Feb 13), a modest cash return that may steady income‑focused holders. PennyMac Reports Q4 and Full‑Year 2025 Results
• Neutral Sentiment: Brokerages maintain a consensus rating around “Moderate Buy,” suggesting analysts see value despite the quarter’s weakness. Consensus Rating: Moderate Buy
• Neutral Sentiment: The company released its full earnings call transcript and slide deck — useful for investors to assess management’s commentary on margins, buybacks and forward assumptions. Q4 2025 Earnings Call Transcript
• Negative Sentiment: Q4 EPS missed materially: $1.97 vs. consensus ~$3.23, driven by lower net revenue components; revenue was $538.0M vs. ~$639.8M expected — the core reason for the sharp share decline. Earnings & Revenues Miss (Zacks)
• Negative Sentiment: Market reaction amplified after reports that management sees margin pressure going forward; Seeking Alpha and other outlets report shares plunged ~22% on the miss and outlook concerns. This drove the intra‑day selloff. Shares Sink 22% After Earnings Miss (Seeking Alpha)

Insider Activity at PennyMac Financial Services

In other news, CFO Daniel Stanley Perotti sold 8,775 shares of PennyMac Financial Services stock in a transaction on Monday, November 17th. The shares were sold at an average price of $126.67, for a total transaction of $1,111,529.25. Following the completion of the sale, the chief financial officer directly owned 216,475 shares of the company’s stock, valued at approximately $27,420,888.25. The trade was a 3.90% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, CAO Gregory L. Hendry sold 3,530 shares of PennyMac Financial Services stock in a transaction dated Thursday, December 18th. The stock was sold at an average price of $131.64, for a total value of $464,689.20. Following the sale, the chief accounting officer directly owned 48,633 shares of the company’s stock, valued at approximately $6,402,048.12. This trade represents a 6.77% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders sold 80,076 shares of company stock worth $10,512,190 over the last quarter. 15.80% of the stock is currently owned by corporate insiders.

Institutional Inflows and Outflows

Several large investors have recently modified their holdings of the stock. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. increased its stake in shares of PennyMac Financial Services by 0.7% in the second quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 16,034 shares of the real estate investment trust’s stock worth $1,598,000 after buying an additional 111 shares during the period. Sei Investments Co. grew its position in shares of PennyMac Financial Services by 0.7% in the 3rd quarter. Sei Investments Co. now owns 22,145 shares of the real estate investment trust’s stock worth $2,743,000 after buying an additional 146 shares during the period. CANADA LIFE ASSURANCE Co grew its holdings in PennyMac Financial Services by 1.0% in the third quarter. CANADA LIFE ASSURANCE Co now owns 16,236 shares of the real estate investment trust’s stock worth $2,026,000 after purchasing an additional 163 shares during the period. EverSource Wealth Advisors LLC purchased a new stake in shares of PennyMac Financial Services in the 2nd quarter worth approximately $26,000. Finally, Interval Partners LP grew its stake in shares of PennyMac Financial Services by 0.9% in the third quarter. Interval Partners LP now owns 31,570 shares of the real estate investment trust’s stock worth $3,911,000 after acquiring an additional 280 shares during the last quarter. Hedge funds and other institutional investors own 57.87% of the company’s stock.

Analysts Set New Price Targets

Several analysts have recently weighed in on PFSI shares. BTIG Research reiterated a “buy” rating on shares of PennyMac Financial Services in a research note on Friday. Barclays raised their price target on shares of PennyMac Financial Services from $139.00 to $158.00 and gave the company an “overweight” rating in a research report on Tuesday, January 6th. UBS Group lifted their price objective on shares of PennyMac Financial Services from $135.00 to $145.00 and gave the stock a “neutral” rating in a report on Friday, October 24th. Zacks Research upgraded PennyMac Financial Services to a “hold” rating in a research note on Friday, December 19th. Finally, Wells Fargo & Company boosted their price target on shares of PennyMac Financial Services from $135.00 to $150.00 and gave the stock an “overweight” rating in a report on Monday, January 5th. Five equities research analysts have rated the stock with a Buy rating and four have given a Hold rating to the company’s stock. According to MarketBeat.com, the company has an average rating of “Moderate Buy” and an average target price of $153.43.

PennyMac Financial Services Company Profile

PennyMac Financial Services, Inc (NYSE: PFSI) is a leading mortgage banking company based in Westlake Village, California. The firm operates through two primary business segments: Production and Mortgage Servicing Rights (MSR). In its Production segment, PennyMac originates residential mortgage loans through retail, wholesale and correspondent channels, focusing on both purchase and refinance transactions. The MSR segment involves the acquisition and servicing of mortgage loans, whereby the company earns fees for managing loan portfolios on behalf of investors.

Since its founding in 2008, PennyMac has grown through a combination of organic origination and strategic acquisition of servicing rights, positioning itself as one of the largest residential mortgage loan servicers in the United States.