Redwood Trust Reports Q1 Earnings: What Key Metrics Have to Say

Redwood Trust RWT reported $24 million in revenue for the quarter ended March 2024, representing a year-over-year decline of 7.7%. EPS of $0.08 for the same period compares to $0.11 a year ago.

The reported revenue compares to the Zacks Consensus Estimate of $22.51 million, representing a surprise of +6.62%. The company has not delivered EPS surprise, with the consensus EPS estimate being $0.08.

While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.

Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance.

Here is how Redwood Trust performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

• Net interest income: $24 million compared to the $23.19 million average estimate based on five analysts.
• Residential Consumer Mortgage Banking Activities, net: $8 million versus the five-analyst average estimate of $10.82 million.
• Residential Investor Mortgage Banking Activities, net: $7 million versus $10.62 million estimated by five analysts on average.
• Total non-interest income (loss), net: $50 million versus the five-analyst average estimate of $32.53 million.
• Other income, net: $5 million versus $3.55 million estimated by four analysts on average.
• Interest income: $205 million versus $207.64 million estimated by three analysts on average.
• Investment fair value changes, net: $22 million versus $5.58 million estimated by three analysts on average.

Shares of Redwood Trust have returned -9.5% over the past month versus the Zacks S&P 500 composite's -2.5% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.

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