Overview
U.S. business purpose lender's Q4 revenue rose 44.6% yr/yr; core diluted EPS beat expectations
Quarter driven by record loan production and gain on sale of nonperforming loans
Nonperforming loans as percent of portfolio fell to 8.5% from 10.7% yr/yr
Outlook
Velocity Financial did not provide specific guidance for the current qtr or full yr
Result Drivers
RECORD LOAN PRODUCTION - Q4 production volume reached a record, driven mainly by demand for Investor 1-4 rental loans, which rose 40.6% yr/yr
NPL SALE GAINS - Net income benefited from a $13.4 mln tax-effected gain on sale of nonperforming loans
Company press release: ID:nBw57W7Wda
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q4 Revenue | $102.9 mln | ||
Q4 Core EPS | Beat | $0.93 | $0.67 (3 Analysts) |
Q4 Core Net Income | $36.3 mln | ||
Q4 Pretax Income | $50.05 mln |
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", no "hold" and 1 "sell" or "strong sell"
The average consensus recommendation for the consumer lending peer group is "buy"
Wall Street's median 12-month price target for Velocity Financial Inc is $22.00, about 21.1% above its March 10 closing price of $18.16
The stock recently traded at 7 times the next 12-month earnings vs. a P/E of 8 three months ago
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)