Redwood Trust Stock: A Deep Dive Into Analyst Perspectives (5 Ratings)

Redwood Trust (NYSE:RWT) has been analyzed by 5 analysts in the last three months, revealing a diverse range of perspectives from bullish to bearish.

In the table below, you'll find a summary of their recent ratings, revealing the shifting sentiments over the past 30 days and comparing them to the previous months.

Analysts provide deeper insights through their assessments of 12-month price targets, revealing an average target of $6.8, a high estimate of $7.00, and a low estimate of $6.50. Highlighting a 4.9% decrease, the current average has fallen from the previous average price target of $7.15.

Investigating Analyst Ratings: An Elaborate Study

The perception of Redwood Trust by financial experts is analyzed through recent analyst actions. The following summary presents key analysts, their recent evaluations, and adjustments to ratings and price targets.

Key Insights:

• Action Taken: Responding to changing market dynamics and company performance, analysts update their recommendations. Whether they 'Maintain', 'Raise', or 'Lower' their stance, it signifies their response to recent developments related to Redwood Trust. This offers insight into analysts' perspectives on the current state of the company.
• Rating: Analysts unravel qualitative evaluations for stocks, ranging from 'Outperform' to 'Underperform'. These ratings offer insights into expectations for the relative performance of Redwood Trust compared to the broader market.
• Price Targets: Analysts provide insights into price targets, offering estimates for the future value of Redwood Trust's stock. This comparison reveals trends in analysts' expectations over time.

To gain a panoramic view of Redwood Trust's market performance, explore these analyst evaluations alongside essential financial indicators. Stay informed and make judicious decisions using our Ratings Table.

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Delving into Redwood Trust's Background

Redwood Trust Inc is a real estate investment trust focused on different areas of housing credit. The company operates in three segments: Sequoia Mortgage Banking includes mortgage loan conduit that acquires residential consumer loans from third-party originators for sale to whole loan buyers and securitization; CoreVest Mortgage Banking segment includes consists of a platform that originates residential investor loans for securitization, sale, or transfer into Redwood Investments portfolio; and Redwood Investments segment consists of organic investments sourced through mortgage banking operations, including securities retained from Sequoia and CoreVest securitization activities. It derives maximum revenue from Redwood Investments segment.

Redwood Trust: A Financial Overview

Market Capitalization Analysis: The company exhibits a lower market capitalization profile, positioning itself below industry averages. This suggests a smaller scale relative to peers.

Negative Revenue Trend: Examining Redwood Trust's financials over 3M reveals challenges. As of 31 March, 2025, the company experienced a decline of approximately -0.94% in revenue growth, reflecting a decrease in top-line earnings. When compared to others in the Financials sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Net Margin: The company's net margin is below industry benchmarks, signaling potential difficulties in achieving strong profitability. With a net margin of 19.5%, the company may need to address challenges in effective cost control.

Return on Equity (ROE): Redwood Trust's ROE is below industry averages, indicating potential challenges in efficiently utilizing equity capital. With an ROE of 1.29%, the company may face hurdles in achieving optimal financial returns.

Return on Assets (ROA): The company's ROA is below industry benchmarks, signaling potential difficulties in efficiently utilizing assets. With an ROA of 0.08%, the company may need to address challenges in generating satisfactory returns from its assets.

Debt Management: With a high debt-to-equity ratio of 15.99, Redwood Trust faces challenges in effectively managing its debt levels, indicating potential financial strain.

How Are Analyst Ratings Determined?

Ratings come from analysts, or specialists within banking and financial systems that report for specific stocks or defined sectors (typically once per quarter for each stock). Analysts usually derive their information from company conference calls and meetings, financial statements, and conversations with important insiders to reach their decisions.

Analysts may enhance their evaluations by incorporating forecasts for metrics like growth estimates, earnings, and revenue, delivering additional guidance to investors. It is vital to acknowledge that, although experts in stocks and sectors, analysts are human and express their opinions when providing insights.

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This article was generated by Benzinga's automated content engine and reviewed by an editor.