Redwood Trust (NYSE:RWT) Issues Earnings Results

Redwood Trust (NYSE:RWT) announced its quarterly earnings results on Wednesday. The real estate investment trust reported $0.21 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.22 by ($0.01), FiscalAI reports. Redwood Trust had a positive return on equity of 12.00% and a negative net margin of 5.93%.The firm had revenue of $63.90 million during the quarter, compared to the consensus estimate of $89.54 million.

Here are the key takeaways from Redwood Trust’s conference call:

• Redwood reported a third consecutive record operating quarter with mortgage banking volume topping $8.5 billion, EAD of $0.21 per share that covered the dividend, and a company-record 11 securitizations completed in Q1.
• Management announced a major Sequoia capital partnership with Castlelake providing roughly $8 billion of incremental purchasing power and a Sequoia JV expected to contribute approximately $0.12–$0.15 of incremental annual earnings as it ramps over the next year.
• Executives highlighted material operating efficiency gains from AI and automation (over 2,500 agentic workflows in Q1), with cost per loan improving to about 18 bps and very high capital turnover that supports scalable margin expansion.
• Financials were mixed: a GAAP net loss of $7 million (driven by marks and one-time items) versus non‑GAAP EAD of $0.21 per share, book value of $7.12 (down 3%), while legacy exposure fell to 15% of capital and management expects the legacy drag to continue moderating; liquidity remained solid with $202 million cash and ~$3.9 billion excess warehouse capacity.
• Aspire and CoreVest showed platform progress: Aspire locked about $1.6 billion in Q1 (estimated ~4% market share, targeted to at least double H2) and CoreVest continues repositioning with CPP JV distributions >$2 billion and restructuring steps intended to drive profitability in 2026.

Redwood Trust Stock Performance

RWT traded down $0.16 on Wednesday, hitting $5.60. The company’s stock had a trading volume of 1,517,331 shares, compared to its average volume of 1,589,274. Redwood Trust has a 12 month low of $5.00 and a 12 month high of $6.97. The firm has a market cap of $699.35 million, a P/E ratio of -9.17 and a beta of 1.52. The company has a quick ratio of 55.15, a current ratio of 55.15 and a debt-to-equity ratio of 24.34. The company’s 50 day simple moving average is $5.82 and its 200-day simple moving average is $5.67.

Redwood Trust Dividend Announcement

The firm also recently disclosed a quarterly dividend, which was paid on Tuesday, March 31st. Investors of record on Tuesday, March 24th were issued a $0.18 dividend. The ex-dividend date of this dividend was Tuesday, March 24th. This represents a $0.72 annualized dividend and a yield of 12.9%. Redwood Trust’s dividend payout ratio (DPR) is -118.03%.

Analyst Ratings Changes

A number of equities analysts recently issued reports on RWT shares. Keefe, Bruyette & Woods increased their target price on Redwood Trust from $5.75 to $7.00 and gave the stock a “market perform” rating in a report on Wednesday, February 18th. JPMorgan Chase & Co. upgraded Redwood Trust from a “neutral” rating to an “overweight” rating and set a $6.00 target price on the stock in a research note on Friday, January 23rd. Weiss Ratings restated a “sell (d)” rating on shares of Redwood Trust in a research report on Thursday, January 22nd. Citigroup reaffirmed a “market perform” rating on shares of Redwood Trust in a research report on Wednesday, February 18th. Finally, Wall Street Zen cut shares of Redwood Trust from a “hold” rating to a “sell” rating in a research note on Monday, April 6th. Five research analysts have rated the stock with a Buy rating, four have issued a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat, the company presently has a consensus rating of “Hold” and an average price target of $6.82.

Hedge Funds Weigh In On Redwood Trust

A number of large investors have recently made changes to their positions in the stock. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC raised its stake in shares of Redwood Trust by 26.7% during the 1st quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 492,661 shares of the real estate investment trust’s stock valued at $2,990,000 after purchasing an additional 103,893 shares during the period. Jane Street Group LLC purchased a new position in Redwood Trust during the 1st quarter valued at about $2,018,000. Strs Ohio bought a new stake in shares of Redwood Trust during the first quarter valued at about $149,000. XTX Topco Ltd lifted its holdings in shares of Redwood Trust by 35.4% in the second quarter. XTX Topco Ltd now owns 14,513 shares of the real estate investment trust’s stock worth $86,000 after buying an additional 3,795 shares in the last quarter. Finally, Russell Investments Group Ltd. lifted its holdings in shares of Redwood Trust by 331.8% in the second quarter. Russell Investments Group Ltd. now owns 7,915 shares of the real estate investment trust’s stock worth $47,000 after buying an additional 6,082 shares in the last quarter. 74.34% of the stock is owned by institutional investors.

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.