Redwood Trust, Inc. 9.125% Seni Fundamental Analysis (NYSE: RWTN)
Redwood Trust, Inc. 9.125% Seni Fundamental Analysis (NYSE: RWTN)
Redwood Trust, Inc. 9.125% Seni (NYSE: RWTN) shows moderate financial fundamentals with a PE ratio of -982.28, profit margin of 0.56%, and ROE of 0.59%. The company generates $1.0B in annual revenue with moderate year-over-year growth of 3.57%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of -1039.1/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze RWTN's fundamental strength across five key dimensions:
Efficiency Score
WeakRWTN struggles to generate sufficient returns from assets.
Valuation Score
ExcellentRWTN trades at attractive valuation levels.
Growth Score
WeakRWTN faces weak or negative growth trends.
Financial Health Score
WeakRWTN carries high financial risk with limited liquidity.
Profitability Score
WeakRWTN struggles to sustain strong margins.
Key Financial Metrics
Is RWTN Expensive or Cheap?
P/E Ratio
RWTN trades at -982.28 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, RWTN's PEG of -28.99 indicates potential undervaluation.
Price to Book
The market values Redwood Trust, Inc. 9.125% Seni at 3.36 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at -24.81 times EBITDA. This is generally considered low.
How Well Does RWTN Make Money?
Net Profit Margin
For every $100 in sales, Redwood Trust, Inc. 9.125% Seni keeps $0.56 as profit after all expenses.
Operating Margin
Core operations generate 94.53 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $0.59 in profit for every $100 of shareholder equity.
ROA
Redwood Trust, Inc. 9.125% Seni generates $0.02 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Redwood Trust, Inc. 9.125% Seni generates limited operating cash flow of $-14.31B, signaling weaker underlying cash strength.
Free Cash Flow
Redwood Trust, Inc. 9.125% Seni generates weak or negative free cash flow of $-14.31B, restricting financial flexibility.
FCF Per Share
Each share generates $-113.97 in free cash annually.
FCF Yield
RWTN converts -4.55% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
-982.28
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-28.99
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.36
vs 25 benchmark
P/S Ratio
Price to sales ratio
3.07
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
29.51
vs 25 benchmark
Current Ratio
Current assets to current liabilities
-174.55
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.006
vs 25 benchmark
ROA
Return on assets percentage
0.00
vs 25 benchmark
ROCE
Return on capital employed
0.03
vs 25 benchmark
How RWTN Stacks Against Its Sector Peers
| Metric | RWTN Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | -982.28 | 23.73 | Better (Cheaper) |
| ROE | 0.59% | 762.00% | Weak |
| Net Margin | 0.56% | 2564.00% | Weak |
| Debt/Equity | 29.51 | -36.87 (disorted) | Distorted |
| Current Ratio | -174.55 | 38.39 | Weak Liquidity |
| ROA | 0.02% | 256.00% | Weak |
RWTN outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Redwood Trust, Inc. 9.125% Seni's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
404.48%
Industry Style: Income, Inflation Hedge, REIT
High GrowthEPS CAGR
89.47%
Industry Style: Income, Inflation Hedge, REIT
High GrowthFCF CAGR
-1646.93%
Industry Style: Income, Inflation Hedge, REIT
Declining