Keefe, Bruyette & Woods Downgrades PennyMac Financial Services (NYSE:PFSI) to Market Perform

Key Points

• Keefe, Bruyette & Woods downgraded PennyMac Financial Services from an "outperform" rating to a "market perform" rating, with a target price of $129.00, indicating a potential 9.04% upside.
• PennyMac reported $1.02 EPS for the last quarter, significantly missing expectations of $3.01, and had revenues of $444.73 million compared to estimates of $547.44 million.
• Insider trading activity showed significant selling, including Director Joseph F. Mazzella selling 7,107 shares, which reflected a 7.63% decrease in his ownership of the stock.

PennyMac Financial Services (NYSE:PFSI - Get Free Report) was downgraded by analysts at Keefe, Bruyette & Woods from an "outperform" rating to a "market perform" rating in a report released on Tuesday, MarketBeat Ratings reports. They currently have a $129.00 target price on the real estate investment trust's stock. Keefe, Bruyette & Woods' target price would suggest a potential upside of 9.04% from the company's current price.

A number of other equities research analysts have also commented on PFSI. UBS Group dropped their price target on PennyMac Financial Services from $115.00 to $110.00 and set a "neutral" rating on the stock in a research report on Thursday, July 24th. Barclays increased their target price on PennyMac Financial Services from $119.00 to $136.00 and gave the stock an "overweight" rating in a research note on Monday. Wells Fargo & Company started coverage on shares of PennyMac Financial Services in a report on Monday, August 25th. They set an "overweight" rating and a $115.00 target price on the stock. Wall Street Zen upgraded shares of PennyMac Financial Services from a "sell" rating to a "hold" rating in a report on Monday, September 29th. Finally, Weiss Ratings reissued a "hold (c)" rating on shares of PennyMac Financial Services in a research report on Saturday, September 27th. Four equities research analysts have rated the stock with a Buy rating and three have issued a Hold rating to the company's stock. Based on data from MarketBeat.com, the company presently has an average rating of "Moderate Buy" and an average price target of $123.50.

PennyMac Financial Services Trading Down 3.9%

Shares of NYSE PFSI opened at $118.31 on Tuesday. PennyMac Financial Services has a twelve month low of $85.74 and a twelve month high of $130.02. The stock has a market cap of $6.12 billion, a price-to-earnings ratio of 16.41 and a beta of 1.59. The company has a quick ratio of 0.34, a current ratio of 0.34 and a debt-to-equity ratio of 3.03. The company's fifty day moving average is $112.63 and its 200-day moving average is $102.94.

PennyMac Financial Services (NYSE:PFSI - Get Free Report) last released its quarterly earnings data on Tuesday, July 22nd. The real estate investment trust reported $1.02 EPS for the quarter, missing analysts' consensus estimates of $3.01 by ($1.99). The firm had revenue of $444.73 million during the quarter, compared to the consensus estimate of $547.44 million. PennyMac Financial Services had a net margin of 22.00% and a return on equity of 12.18%. PennyMac Financial Services's quarterly revenue was up 9.5% on a year-over-year basis. During the same quarter in the prior year, the company earned $1.85 EPS. Equities research analysts predict that PennyMac Financial Services will post 13.77 EPS for the current year.

Insider Buying and Selling at PennyMac Financial Services

In related news, Director Joseph F. Mazzella sold 7,107 shares of the firm's stock in a transaction on Wednesday, August 13th. The shares were sold at an average price of $108.16, for a total value of $768,693.12. Following the completion of the transaction, the director owned 86,050 shares of the company's stock, valued at approximately $9,307,168. This trade represents a 7.63% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, insider Derek Stark sold 4,750 shares of PennyMac Financial Services stock in a transaction on Monday, August 25th. The shares were sold at an average price of $109.56, for a total transaction of $520,410.00. Following the completion of the sale, the insider owned 20,621 shares in the company, valued at $2,259,236.76. The trade was a 18.72% decrease in their ownership of the stock. The disclosure for this sale can be found here. Over the last ninety days, insiders have sold 30,632 shares of company stock worth $3,406,716. Company insiders own 15.80% of the company's stock.

Institutional Inflows and Outflows

Several large investors have recently bought and sold shares of PFSI. EverSource Wealth Advisors LLC bought a new position in PennyMac Financial Services in the second quarter valued at approximately $26,000. CWM LLC raised its stake in shares of PennyMac Financial Services by 71.5% during the 1st quarter. CWM LLC now owns 271 shares of the real estate investment trust's stock worth $27,000 after purchasing an additional 113 shares in the last quarter. Strs Ohio acquired a new stake in shares of PennyMac Financial Services in the 1st quarter valued at approximately $30,000. Bayforest Capital Ltd bought a new position in shares of PennyMac Financial Services in the second quarter valued at $62,000. Finally, Raymond James Financial Inc. bought a new position in shares of PennyMac Financial Services in the second quarter valued at $82,000. 57.87% of the stock is owned by institutional investors and hedge funds.

PennyMac Financial Services Company Profile

PennyMac Financial Services, Inc, through its subsidiaries, engages in the mortgage banking and investment management activities in the United States. The company operates through three segments: Production, Servicing, and Investment Management. The Production segment is involved in the origination, acquisition, and sale of loans.

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