Redwood Trust (NYSE:RWT) Shares Gap Up Following Dividend Announcement

Redwood Trust, Inc. (NYSE:RWT) shares gapped up prior to trading on Thursday following a dividend announcement from the company. The stock had previously closed at $7.40, but opened at $7.65. Redwood Trust shares last traded at $7.62, with a volume of 111,958 shares trading hands.

The newly announced dividend which will be paid on Monday, September 30th. Investors of record on Monday, September 23rd will be paid a $0.17 dividend. This represents a $0.68 dividend on an annualized basis and a yield of 8.45%. This is a boost from Redwood Trust’s previous quarterly dividend of $0.16. The ex-dividend date of this dividend is Monday, September 23rd. Redwood Trust’s dividend payout ratio (DPR) is 914.29%.

Analyst Upgrades and Downgrades

Several equities research analysts have weighed in on RWT shares. JMP Securities upped their target price on Redwood Trust from $8.00 to $8.50 and gave the stock a “market outperform” rating in a research note on Friday, July 19th. Wedbush boosted their target price on Redwood Trust from $6.50 to $7.00 and gave the stock a “neutral” rating in a research note on Friday, August 2nd. JPMorgan Chase & Co. raised their price target on shares of Redwood Trust from $7.00 to $7.50 and gave the company an “overweight” rating in a research note on Tuesday, July 16th. Finally, Piper Sandler lifted their price target on shares of Redwood Trust from $6.50 to $7.50 and gave the company a “neutral” rating in a report on Monday, August 5th. Four investment analysts have rated the stock with a hold rating, five have assigned a buy rating and one has assigned a strong buy rating to the stock. According to MarketBeat.com, the company has an average rating of “Moderate Buy” and an average target price of $7.81.

Redwood Trust Price Performance

The stock has a market cap of $1.06 billion, a P/E ratio of 115.00 and a beta of 1.58. The business has a 50-day simple moving average of $7.25 and a 200 day simple moving average of $6.57. The company has a current ratio of 50.47, a quick ratio of 50.47 and a debt-to-equity ratio of 12.97.

Redwood Trust (NYSE:RWT) last released its earnings results on Thursday, August 1st. The real estate investment trust reported $0.13 earnings per share for the quarter, beating analysts’ consensus estimates of $0.12 by $0.01. Redwood Trust had a net margin of 4.45% and a return on equity of 4.93%. During the same quarter in the prior year, the firm posted $0.14 earnings per share. On average, analysts forecast that Redwood Trust, Inc. will post 0.5 earnings per share for the current year.

Institutional Inflows and Outflows

Hedge funds have recently made changes to their positions in the business. Wellington Management Group LLP grew its stake in Redwood Trust by 164.4% during the fourth quarter. Wellington Management Group LLP now owns 11,314,715 shares of the real estate investment trust’s stock worth $83,842,000 after purchasing an additional 7,035,524 shares during the period. Vanguard Group Inc. increased its stake in shares of Redwood Trust by 19.5% in the 1st quarter. Vanguard Group Inc. now owns 15,504,440 shares of the real estate investment trust’s stock valued at $98,763,000 after acquiring an additional 2,530,937 shares in the last quarter. Ceredex Value Advisors LLC lifted its position in shares of Redwood Trust by 48.8% during the 2nd quarter. Ceredex Value Advisors LLC now owns 906,512 shares of the real estate investment trust’s stock valued at $5,883,000 after acquiring an additional 297,100 shares during the period. Van ECK Associates Corp boosted its stake in Redwood Trust by 21.7% during the second quarter. Van ECK Associates Corp now owns 976,283 shares of the real estate investment trust’s stock worth $6,336,000 after acquiring an additional 174,317 shares in the last quarter. Finally, Peregrine Capital Management LLC grew its holdings in Redwood Trust by 13.3% in the first quarter. Peregrine Capital Management LLC now owns 1,148,565 shares of the real estate investment trust’s stock worth $7,316,000 after purchasing an additional 134,715 shares during the period. 74.34% of the stock is owned by institutional investors.

About Redwood Trust

Redwood Trust, Inc, together with its subsidiaries, operates as a specialty finance company in the United States. The company operates through three segments: Residential Consumer Mortgage Banking, Residential Investor Mortgage Banking, and Investment Portfolio. The Residential Consumer Mortgage Banking segment operates a mortgage loan conduit that acquires residential loans from third-party originators for subsequent sale, securitization, or transfer to its investment portfolio.