UWM (NYSE:UWMC) Shares Down 5.2% - Should You Sell?

Key Points

• Shares of UWM fell about 5.2% to roughly $3.72 on Friday with unusually light volume (~583,806 shares, down ~97% from the ~18.5M average), leaving the stock below its 50- and 200-day moving averages and valuing the company near $5.9 billion.
• Analysts are mixed: the consensus rating is a Hold with an average price target of $6.36, though several firms recently cut targets and ratings range from Buy to Sell.
• UWM pays a $0.10 quarterly dividend (about a 10.9% yield) but carries a very high payout ratio (666.7%), and insider selling has been heavy—CEO Ishbia sold ~1.0M shares on March 16 and insiders have sold ~24.6M shares in the past 90 days.

Shares of UWM Holdings Corporation (NYSE:UWMC - Get Free Report) dropped 5.2% during trading on Friday . The company traded as low as $3.77 and last traded at $3.7150. Approximately 583,806 shares were traded during trading, a decline of 97% from the average daily volume of 18,506,246 shares. The stock had previously closed at $3.92.

Analysts Set New Price Targets

UWMC has been the subject of several research reports. Weiss Ratings cut shares of UWM from a "hold (c-)" rating to a "sell (d+)" rating in a research note on Friday, March 27th. Keefe, Bruyette & Woods decreased their price objective on shares of UWM from $6.75 to $6.00 and set a "market perform" rating on the stock in a report on Friday, February 27th. Barclays decreased their price objective on shares of UWM from $6.00 to $5.00 and set an "overweight" rating on the stock in a report on Monday. Morgan Stanley set a $6.00 target price on shares of UWM in a report on Tuesday, December 16th. Finally, BTIG Research restated a "buy" rating and issued a $10.00 price objective on shares of UWM in a report on Tuesday, March 10th. Three investment analysts have rated the stock with a Buy rating, seven have issued a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, UWM presently has an average rating of "Hold" and an average target price of $6.36.

UWM Stock Down 6.0%

The company has a market cap of $5.90 billion, a PE ratio of 61.58 and a beta of 1.93. The company has a quick ratio of 1.52, a current ratio of 1.52 and a debt-to-equity ratio of 2.64. The firm's fifty day simple moving average is $4.19 and its 200-day simple moving average is $5.01.

UWM (NYSE:UWMC - Get Free Report) last posted its quarterly earnings data on Wednesday, February 25th. The company reported $0.08 earnings per share for the quarter, missing analysts' consensus estimates of $0.09 by ($0.01). UWM had a net margin of 0.87% and a negative return on equity of 1.35%. The firm had revenue of $945.25 million during the quarter, compared to analyst estimates of $759.12 million. As a group, equities research analysts expect that UWM Holdings Corporation will post 0.2 earnings per share for the current fiscal year.

UWM Announces Dividend

The company also recently announced a quarterly dividend, which was paid on Thursday, April 9th. Stockholders of record on Thursday, March 19th were paid a $0.10 dividend. The ex-dividend date was Thursday, March 19th. This represents a $0.40 annualized dividend and a dividend yield of 10.9%. UWM's dividend payout ratio is 666.67%.

Insider Buying and Selling at UWM

In other UWM news, CEO Ishbia Mat sold 1,000,574 shares of the stock in a transaction on Monday, March 16th. The shares were sold at an average price of $3.70, for a total transaction of $3,702,123.80. Following the transaction, the chief executive officer directly owned 11,335,023 shares in the company, valued at $41,939,585.10. This represents a 8.11% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available through this link. Insiders have sold 24,561,842 shares of company stock valued at $107,798,721 in the last ninety days. 87.50% of the stock is currently owned by corporate insiders.

Institutional Trading of UWM

A number of institutional investors and hedge funds have recently modified their holdings of the business. Dimensional Fund Advisors LP increased its holdings in shares of UWM by 4.4% in the 4th quarter. Dimensional Fund Advisors LP now owns 55,509 shares of the company's stock worth $243,000 after acquiring an additional 2,329 shares during the period. Public Employees Retirement System of Ohio boosted its position in shares of UWM by 4.9% during the 4th quarter. Public Employees Retirement System of Ohio now owns 51,423 shares of the company's stock valued at $225,000 after purchasing an additional 2,407 shares in the last quarter. Allworth Financial LP boosted its position in shares of UWM by 62.5% during the 4th quarter. Allworth Financial LP now owns 6,765 shares of the company's stock valued at $30,000 after purchasing an additional 2,602 shares in the last quarter. Choreo LLC boosted its position in shares of UWM by 16.1% during the 4th quarter. Choreo LLC now owns 19,017 shares of the company's stock valued at $84,000 after purchasing an additional 2,637 shares in the last quarter. Finally, State of Wyoming boosted its holdings in shares of UWM by 24.9% in the third quarter. State of Wyoming now owns 14,552 shares of the company's stock worth $89,000 after buying an additional 2,902 shares during the period. 53.59% of the stock is owned by institutional investors and hedge funds.

UWM Company Profile

United Wholesale Mortgage NYSE: UWMC is a leading mortgage lender in the United States specializing in the wholesale channel. The company partners with independent mortgage brokers, community banks and credit unions to offer a full suite of residential mortgage products. Through its network of third-party originators, United Wholesale Mortgage underwrites, funds and closes loans, allowing its partners to focus on customer acquisition and service.

The company’s product offerings include conventional fixed- and adjustable-rate mortgages, Federal Housing Administration (FHA) loans, Veterans Affairs (VA) loans, U.S.

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