Redwood Trust, Inc. (NYSE:RWT) Stock Short Interest Rises 238.4%

Key Points

• Redwood Trust’s short interest surged 238.4% to 21.5 million shares as of September 15, representing approximately 17.7% of shares outstanding.
• The stock traded near $3.73, well below its 50-day and 200-day moving averages. Analysts hold a consensus “Hold” rating with an average price target of $5.84.
• Redwood Trust declared a quarterly dividend of $0.18 per share, equivalent to a 19.3% annualized yield, while its CEO and CFO purchased a combined 126,065 shares in September.

Redwood Trust, Inc. (NYSE:RWT - Get Free Report) was the target of a large growth in short interest during the month of September. As of September 15th, there was short interest totaling 21,510,300 shares, a growth of 238.4% from the August 31st total of 6,356,217 shares. Approximately 17.7% of the shares of the stock are sold short. Based on an average trading volume of 10,267,153 shares, the short-interest ratio is presently 2.1 days.

Redwood Trust Trading Up 1.2%

RWT traded up $0.04 during trading on Friday, reaching $3.73. 4,599,356 shares of the stock traded hands, compared to its average volume of 7,779,649. The stock's 50-day moving average is $4.48 and its 200 day moving average is $5.07. Redwood Trust has a 12 month low of $3.22 and a 12 month high of $6.97. The company has a quick ratio of 67.49, a current ratio of 67.49 and a debt-to-equity ratio of 31.69. The stock has a market capitalization of $467.90 million, a PE ratio of -93.10 and a beta of 1.37.

Redwood Trust (NYSE:RWT - Get Free Report) last announced its quarterly earnings data on Tuesday, July 28th. The real estate investment trust reported $0.25 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.23 by $0.02. Redwood Trust had a return on equity of 16.02% and a net margin of 0.42%.The company had revenue of $56.01 million for the quarter, compared to the consensus estimate of $89.45 million. Equities analysts anticipate that Redwood Trust will post 1.03 earnings per share for the current year.

Redwood Trust Announces Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Wednesday, September 30th. Stockholders of record on Wednesday, September 23rd will be given a dividend of $0.18 per share. The ex-dividend date of this dividend is Wednesday, September 23rd. This represents a $0.72 annualized dividend and a dividend yield of 19.3%. Redwood Trust's dividend payout ratio (DPR) is -1,800.00%.

Insider Transactions at Redwood Trust

In other news, CFO Brooke Carillo acquired 26,065 shares of the stock in a transaction dated Tuesday, September 15th. The stock was bought at an average price of $3.85 per share, with a total value of $100,350.25. Following the completion of the purchase, the chief financial officer directly owned 140,481 shares of the company's stock, valued at $540,851.85. This represents a 22.78% increase in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at the SEC website. Also, CEO Christopher J. Abate acquired 100,000 shares of the company's stock in a transaction that occurred on Tuesday, September 15th. The stock was acquired at an average price of $3.84 per share, with a total value of $384,000.00. Following the acquisition, the chief executive officer owned 679,283 shares in the company, valued at $2,608,446.72. The trade was a 17.26% increase in their ownership of the stock. The SEC filing for this purchase provides additional information. Insiders acquired 244,171 shares of company stock worth $948,402 in the last 90 days. 3.30% of the stock is currently owned by company insiders.

Institutional Inflows and Outflows

A number of institutional investors have recently modified their holdings of the stock. State Street Corp grew its holdings in Redwood Trust by 5.1% in the second quarter. State Street Corp now owns 5,216,721 shares of the real estate investment trust's stock worth $24,727,000 after purchasing an additional 254,399 shares during the period. Bank of New York Mellon Corp raised its holdings in shares of Redwood Trust by 0.4% during the second quarter. Bank of New York Mellon Corp now owns 714,220 shares of the real estate investment trust's stock valued at $3,385,000 after purchasing an additional 2,627 shares during the period. Bank of America Corp DE bought a new position in shares of Redwood Trust during the 2nd quarter worth about $2,032,000. Quantinno Capital Management LP boosted its position in shares of Redwood Trust by 22.7% during the 1st quarter. Quantinno Capital Management LP now owns 373,932 shares of the real estate investment trust's stock worth $2,098,000 after purchasing an additional 69,173 shares in the last quarter. Finally, Legal & General Group Plc bought a new position in shares of Redwood Trust during the 2nd quarter worth about $1,349,000. Institutional investors and hedge funds own 74.34% of the company's stock.

Wall Street Analysts Forecast Growth

Several equities analysts have recently issued reports on the stock. UBS Group dropped their price target on shares of Redwood Trust from $7.00 to $6.50 and set a "buy" rating for the company in a research note on Friday, August 21st. Citizens Jmp decreased their price objective on Redwood Trust from $7.00 to $6.00 and set a "market outperform" rating for the company in a report on Wednesday, July 8th. Piper Sandler lowered their target price on Redwood Trust from $6.50 to $5.50 and set a "neutral" rating for the company in a research report on Thursday, July 2nd. JonesTrading cut their target price on Redwood Trust from $6.25 to $6.00 and set a "buy" rating on the stock in a report on Tuesday, July 28th. Finally, Keefe, Bruyette & Woods reduced their price target on Redwood Trust from $5.50 to $4.75 and set an "outperform" rating on the stock in a research report on Monday, September 14th. Six analysts have rated the stock with a Buy rating, four have assigned a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat, the company has a consensus rating of "Hold" and an average price target of $5.84.

About Redwood Trust

Redwood Trust, Inc is a real estate investment trust that focuses on residential real estate credit. The company invests in, finances and manages residential mortgage assets, including jumbo and other non-agency mortgage loans, mortgage-backed securities and related credit investments. Its activities are primarily focused on the U.S. housing market.

Redwood operates through businesses that support the origination, financing and securitization of residential mortgage credit. Its platform has historically included Sequoia, which acquires and securitizes residential loans, as well as CoreVest, which provides financing to residential real estate investors and developers.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.