Redwood Trust Plays The Waiting Game On Mortgage Security

Redwood Trust RWT is believed to be well positioned to capitalize on the eventual growth of the private label security market, according to Jefferies. EPS missed the Street's estimates by $0.20 with the variance focused on market valuation adjustments and realized gains, both inherently volatile items, according to Jefferies. Jefferies has lowered the price target from $20 to $18, and maintains its "buy" rating, estimating that RWT will play a dominating role in the rebirth of the mortgage security market. Redwood Trust closed yesterday at $15.90.