FBR Capital Starts Redwood Trust (RWT) at Market Perform; This Boat Will Sail; It Just Needs Some Wind
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Price: $4.81 +0.84%
Rating Summary:
11 Buy, 8 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
11 Buy, 8 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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FBR Capital initiates coverage on Redwood Trust (NYSE: RWT) with a Market Perform. PT$14.
FBR analyst says, "With leverageable infrastructure in place, we believe that Redwood is the purest way to play the eventual return of the private-label mortgage securitization market. At this juncture, however, with the housing market barely treading water, we believe that Redwood’s core conduit business model lacks the volume necessary to generate attractive economic returns relative to others in the residential mortgage REIT space. We note that, in the past 15 months, the company has successfully priced two securitizations and has plans for two more in the second half of 2011. We are keeping a keen eye on this trajectory, especially in front of the scheduled conforming loan limit reduction to $625,000 from $729,750 at the end of September, which could open the spigot to a degree."
For more ratings news on Redwood Trust click here and for the rating history of Redwood Trust click here.
Shares of Redwood Trust closed at $15.11 yesterday.
FBR analyst says, "With leverageable infrastructure in place, we believe that Redwood is the purest way to play the eventual return of the private-label mortgage securitization market. At this juncture, however, with the housing market barely treading water, we believe that Redwood’s core conduit business model lacks the volume necessary to generate attractive economic returns relative to others in the residential mortgage REIT space. We note that, in the past 15 months, the company has successfully priced two securitizations and has plans for two more in the second half of 2011. We are keeping a keen eye on this trajectory, especially in front of the scheduled conforming loan limit reduction to $625,000 from $729,750 at the end of September, which could open the spigot to a degree."
For more ratings news on Redwood Trust click here and for the rating history of Redwood Trust click here.
Shares of Redwood Trust closed at $15.11 yesterday.
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