UBS Group AG Grows Position in Rithm Capital Corp. $RITM

Key Points

• UBS Group AG increased its stake in Rithm Capital by 4.0% in the fourth quarter to 3,869,113 shares (about 0.70% of the company) worth roughly $42.17 million, and other institutions — notably Goldman Sachs — also materially raised positions, leaving institutional ownership at about 44.9%.
• Rithm declared a quarterly dividend of $0.25 ($1.00 annualized) for a yield of 10.1%, but the payout ratio is high at about 91.7%, indicating limited room for payout growth without earnings improvement.
• On fundamentals, Rithm reported Q1 EPS of $0.51 (missed by $0.02) while revenue beat, trades near $9.86 with a P/E of 9.04 and a market cap of $5.5B, and carries a consensus "Moderate Buy" rating with an average target of $13.63 amid mixed analyst target cuts.

UBS Group AG increased its holdings in Rithm Capital Corp. (NYSE:RITM - Free Report) by 4.0% in the fourth quarter, according to the company in its most recent disclosure with the Securities and Exchange Commission (SEC). The firm owned 3,869,113 shares of the real estate investment trust's stock after acquiring an additional 150,291 shares during the quarter. UBS Group AG owned approximately 0.70% of Rithm Capital worth $42,173,000 as of its most recent SEC filing.

A number of other hedge funds also recently added to or reduced their stakes in RITM. AQR Capital Management LLC lifted its stake in Rithm Capital by 20.4% in the first quarter. AQR Capital Management LLC now owns 77,625 shares of the real estate investment trust's stock worth $889,000 after acquiring an additional 13,166 shares during the period. NewEdge Advisors LLC lifted its stake in Rithm Capital by 5.3% in the first quarter. NewEdge Advisors LLC now owns 31,311 shares of the real estate investment trust's stock worth $359,000 after acquiring an additional 1,585 shares during the period. Goldman Sachs Group Inc. lifted its stake in Rithm Capital by 75.6% in the first quarter. Goldman Sachs Group Inc. now owns 1,539,483 shares of the real estate investment trust's stock worth $17,627,000 after acquiring an additional 662,585 shares during the period. Geneos Wealth Management Inc. lifted its position in shares of Rithm Capital by 14.3% during the first quarter. Geneos Wealth Management Inc. now owns 7,031 shares of the real estate investment trust's stock valued at $81,000 after buying an additional 881 shares during the last quarter. Finally, M&T Bank Corp lifted its position in shares of Rithm Capital by 13.9% during the second quarter. M&T Bank Corp now owns 26,173 shares of the real estate investment trust's stock valued at $296,000 after buying an additional 3,200 shares during the last quarter. 44.92% of the stock is owned by hedge funds and other institutional investors.

Rithm Capital Stock Performance

RITM opened at $9.86 on Thursday. Rithm Capital Corp. has a 52-week low of $8.43 and a 52-week high of $12.74. The company has a quick ratio of 0.58, a current ratio of 1.28 and a debt-to-equity ratio of 4.02. The company has a market cap of $5.50 billion, a P/E ratio of 9.04 and a beta of 1.17. The firm's 50-day moving average price is $9.73 and its 200-day moving average price is $10.62.

Rithm Capital (NYSE:RITM - Get Free Report) last posted its quarterly earnings data on Tuesday, April 28th. The real estate investment trust reported $0.51 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.53 by ($0.02). Rithm Capital had a net margin of 14.44% and a return on equity of 19.48%. The company had revenue of $1.38 billion for the quarter, compared to analyst estimates of $1.27 billion. As a group, equities analysts anticipate that Rithm Capital Corp. will post 2.28 EPS for the current fiscal year.

Rithm Capital Announces Dividend

The business also recently disclosed a quarterly dividend, which was paid on Thursday, April 30th. Stockholders of record on Monday, April 6th were issued a dividend of $0.25 per share. The ex-dividend date was Monday, April 6th. This represents a $1.00 annualized dividend and a dividend yield of 10.1%. Rithm Capital's dividend payout ratio is 91.74%.

Wall Street Analysts Forecast Growth

Several analysts have commented on RITM shares. Piper Sandler decreased their price target on shares of Rithm Capital from $15.00 to $14.00 and set an "overweight" rating for the company in a research report on Thursday, April 2nd. Royal Bank Of Canada decreased their price target on shares of Rithm Capital from $14.00 to $13.00 and set an "outperform" rating for the company in a research report on Friday, May 1st. Wall Street Zen lowered shares of Rithm Capital from a "buy" rating to a "hold" rating in a research report on Saturday, May 2nd. BTIG Research reissued a "buy" rating and set a $16.00 price target on shares of Rithm Capital in a research report on Friday, April 10th. Finally, UBS Group decreased their price target on shares of Rithm Capital from $15.00 to $14.50 and set a "buy" rating for the company in a research report on Friday, April 10th. Seven investment analysts have rated the stock with a Buy rating and one has assigned a Hold rating to the company's stock. Based on data from MarketBeat, the company has a consensus rating of "Moderate Buy" and an average target price of $13.63.

About Rithm Capital

Rithm Capital Corporation is a specialty finance company that originates, acquires and manages structured credit investments collateralized by real estate assets in the United States. The company focuses primarily on senior floating-rate loans secured by multifamily, commercial, industrial and single-family rental properties, aiming to deliver attractive risk-adjusted yields through a diversified portfolio of floating-rate real estate debt.

In addition to senior loans, Rithm Capital invests in residential mortgage-backed securities, including agency and non-agency pools, as well as other real estate-related credit instruments.

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