PennyMac Financial Services (NYSE:PFSI) Sets New 1-Year Low After Analyst Downgrade

Key Points

• PennyMac Financial Services fell to a new 52-week low of $58.72 after BTIG Research cut its price target from $90 to $80, though it maintained a Buy rating.
• Analyst sentiment is mixed: the stock has a consensus Hold rating and a $100 target price, with four Buy, four Hold and two Sell ratings.
• The company’s latest quarterly results missed expectations, reporting $1.39 in EPS versus $2.11 forecast and revenue of $496.96 million versus $571.60 million expected; it also pays a quarterly dividend of $0.30.

PennyMac Financial Services, Inc. (NYSE:PFSI - Get Free Report) hit a new 52-week low during mid-day trading on Tuesday after BTIG Research lowered their price target on the stock from $90.00 to $80.00. BTIG Research currently has a buy rating on the stock. PennyMac Financial Services traded as low as $58.72 and last traded at $58.82, with a volume of 679,711 shares changing hands. The stock had previously closed at $59.90.

A number of other equities analysts have also recently weighed in on the stock. Wall Street Zen cut shares of PennyMac Financial Services from a "hold" rating to a "sell" rating in a research report on Saturday, August 1st. Wells Fargo & Company decreased their price target on shares of PennyMac Financial Services from $100.00 to $95.00 and set an "overweight" rating for the company in a report on Thursday, July 30th. Barclays lowered their price objective on shares of PennyMac Financial Services from $85.00 to $71.00 and set an "equal weight" rating for the company in a research report on Monday, October 5th. Weiss Ratings restated a "sell (d+)" rating on shares of PennyMac Financial Services in a research report on Monday, August 3rd. Finally, Keefe, Bruyette & Woods dropped their price objective on PennyMac Financial Services from $108.00 to $100.00 and set an "outperform" rating on the stock in a research note on Friday, July 31st. Four investment analysts have rated the stock with a Buy rating, four have given a Hold rating and two have given a Sell rating to the stock. According to data from MarketBeat, the stock currently has a consensus rating of "Hold" and a consensus target price of $100.00.

Institutional Trading of PennyMac Financial Services

Hedge funds have recently bought and sold shares of the stock. The Manufacturers Life Insurance Company acquired a new position in shares of PennyMac Financial Services during the second quarter worth about $1,713,000. BlueCrest Capital Management Ltd grew its holdings in shares of PennyMac Financial Services by 12.8% during the second quarter. BlueCrest Capital Management Ltd now owns 396,103 shares of the real estate investment trust's stock worth $34,501,000 after buying an additional 45,008 shares in the last quarter. Legal & General Group Plc bought a new position in shares of PennyMac Financial Services during the second quarter worth about $2,250,000. Donald Smith & CO. Inc. bought a new position in shares of PennyMac Financial Services during the second quarter worth about $163,940,000. Finally, BlackRock Inc. bought a new position in shares of PennyMac Financial Services during the second quarter worth about $202,735,000. 57.87% of the stock is currently owned by institutional investors and hedge funds.

PennyMac Financial Services Stock Performance

The stock has a 50-day moving average of $70.17 and a 200-day moving average of $80.25. The firm has a market cap of $3.06 billion, a price-to-earnings ratio of 8.08, a price-to-earnings-growth ratio of 0.59 and a beta of 1.45. The company has a debt-to-equity ratio of 3.22, a quick ratio of 0.38 and a current ratio of 0.38.

PennyMac Financial Services (NYSE:PFSI - Get Free Report) last released its earnings results on Wednesday, July 29th. The real estate investment trust reported $1.39 EPS for the quarter, missing the consensus estimate of $2.11 by ($0.72). PennyMac Financial Services had a net margin of 17.74% and a return on equity of 11.18%. The firm had revenue of $496.96 million during the quarter, compared to the consensus estimate of $571.60 million. During the same quarter in the previous year, the firm posted $2.54 EPS. The company's revenue was up 11.8% on a year-over-year basis. As a group, analysts anticipate that PennyMac Financial Services, Inc. will post 7.09 EPS for the current fiscal year.

PennyMac Financial Services Dividend Announcement

The firm also recently disclosed a quarterly dividend, which was paid on Thursday, August 27th. Stockholders of record on Monday, August 17th were issued a $0.30 dividend. The ex-dividend date was Monday, August 17th. This represents a $1.20 dividend on an annualized basis and a dividend yield of 2.0%. PennyMac Financial Services's dividend payout ratio (DPR) is 16.48%.

About PennyMac Financial Services

PennyMac Financial Services, Inc NYSE: PFSI is a financial services company focused on the U.S. residential mortgage market. Through its operating subsidiaries, the company originates, acquires, services and manages investments in residential mortgage loans and related assets.

PennyMac's business includes mortgage loan production through correspondent and consumer-direct channels, mortgage servicing and loan administration, and investment management activities. Its services support homeowners, mortgage originators and institutional investors across the residential lending lifecycle, including loan fulfillment, servicing and asset management.

The company was established in 2008 and serves customers and business partners throughout the United States.

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