DB:14N1

Stock Analysis Report

New Residential Investment

Executive Summary

New Residential Investment Corp., a real estate investment trust, focuses on investing in and managing residential mortgage related assets in the United States.


Snowflake Analysis

Very undervalued with reasonable growth potential.


Similar Companies

Share Price & News

How has New Residential Investment's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 14N1's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

15.0%

14N1

23.7%

DE Mortgage REITs

7.3%

DE Market


1 Year Return

-64.4%

14N1

-48.4%

DE Mortgage REITs

-17.7%

DE Market

Return vs Industry: 14N1 underperformed the German Mortgage REITs industry which returned -48.4% over the past year.

Return vs Market: 14N1 underperformed the German Market which returned -17.7% over the past year.


Shareholder returns

14N1IndustryMarket
7 Day15.0%23.7%7.3%
30 Day-61.4%-45.1%-17.9%
90 Day-61.8%-48.4%-25.8%
1 Year-59.6%-64.4%-43.5%-48.4%-15.1%-17.7%
3 Yearn/a-32.1%-50.1%-18.7%-25.6%
5 Yearn/a-17.1%-51.6%-17.7%-29.0%

Price Volatility Vs. Market

How volatile is New Residential Investment's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is New Residential Investment undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 14N1 (€6.12) is trading below our estimate of fair value (€20.49)

Significantly Below Fair Value: 14N1 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 14N1 is good value based on its PE Ratio (5.1x) compared to the Mortgage REITs industry average (5.1x).

PE vs Market: 14N1 is good value based on its PE Ratio (5.1x) compared to the German market (16.4x).


Price to Earnings Growth Ratio

PEG Ratio: 14N1 is good value based on its PEG Ratio (0.2x)


Price to Book Ratio

PB vs Industry: 14N1 is good value based on its PB Ratio (0.4x) compared to the XX Mortgage REITs industry average (0.5x).


Next Steps

Future Growth

How is New Residential Investment forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

21.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 14N1's forecast earnings growth (21.4% per year) is above the savings rate (-0.4%).

Earnings vs Market: 14N1's earnings (21.4% per year) are forecast to grow faster than the German market (14.3% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 14N1's revenue (18.1% per year) is forecast to grow faster than the German market (4.1% per year).

High Growth Revenue: 14N1's revenue (18.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 14N1's Return on Equity is forecast to be low in 3 years time (13.3%).


Next Steps

Past Performance

How has New Residential Investment performed over the past 5 years?

17.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 14N1 has high quality earnings.

Growing Profit Margin: 14N1's current net profit margins (35.3%) are lower than last year (62.5%).


Past Earnings Growth Analysis

Earnings Trend: 14N1's earnings have grown by 17.9% per year over the past 5 years.

Accelerating Growth: 14N1's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 14N1 had negative earnings growth (-42.9%) over the past year, making it difficult to compare to the Mortgage REITs industry average (14.3%).


Return on Equity

High ROE: 14N1's Return on Equity (8.4%) is considered low.


Next Steps

Financial Health

How is New Residential Investment's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: 14N1 has a low level of unsold assets or inventory.

Debt Coverage by Assets: 14N1's debt is not covered by short term assets (assets are 0.5x debt).


Financial Institutions Analysis

Asset Level: 14N1's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if 14N1 has a sufficient allowance for bad loans.

Low Risk Liabilities: 14N1 reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if 14N1 has an acceptable proportion of non-loan assets held.

Low Risk Deposits: 14N1 has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if 14N1 has an appropriate level of bad loans.


Next Steps

Dividend

What is New Residential Investment's current dividend yield, its reliability and sustainability?

33.50%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 14N1's dividend (29.07%) is higher than the bottom 25% of dividend payers in the German market (1.7%).

High Dividend: 14N1's dividend (29.07%) is in the top 25% of dividend payers in the German market (4.97%)


Stability and Growth of Payments

Stable Dividend: 14N1 has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: 14N1's dividend payments have increased, but the company has only paid a dividend for 7 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (148.6%), 14N1's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 14N1's dividends in 3 years are not forecast to be well covered by earnings (90.4% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.3yrs

Average board tenure


CEO

Michael Nierenberg (56yo)

6.33s

Tenure

Michael Nierenberg is a Managing Director at Fortress. Mr. Nierenberg served as Managing Director and head of Global Mortgages and Securitized Products at Bank of America Merrill Lynch, with responsibility ...


Board Members

NamePositionTenureCompensationOwnership
Michael Nierenberg
Chairman6.33yrsno data0.26% $5.9m
Pamela Lenehan
Independent Director0.92yrno data0.0045% $101.6k
Douglas Jacobs
Independent Director6.75yrsUS$240.00k0.0079% $177.0k
David Saltzman
Independent Director6.92yrsUS$200.00k0.011% $241.9k
Kevin Finnerty
Independent Director6.92yrsUS$200.00k0.057% $1.3m
Robert McGinnis
Independent Director3.25yrsUS$200.00k0.019% $417.1k
Alan Tyson
Independent Director6.92yrsUS$200.00k0.030% $677.1k
Andrew Sloves
Independent Director3.75yrsUS$200.00k0.019% $421.3k

5.3yrs

Average Tenure

63yo

Average Age

Experienced Board: 14N1's board of directors are considered experienced (5.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: 14N1 insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 19.8%.


Top Shareholders

Company Information

New Residential Investment Corp.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: New Residential Investment Corp.
  • Ticker: 14N1
  • Exchange: DB
  • Founded: 2011
  • Industry: Mortgage REITs
  • Sector: Diversified Financials
  • Market Cap: US$2.481b
  • Listing Market Cap: US$2.237b
  • Shares outstanding: 415.55m
  • Website: https://www.newresi.com

Number of Employees


Location

  • New Residential Investment Corp.
  • 1345 Avenue Of The Americas
  • 45th Floor
  • New York
  • New York
  • 10105
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NRZNYSE (New York Stock Exchange)YesCommon StockUSUSDMay 2013
14N1DB (Deutsche Boerse AG)YesCommon StockDEEURMay 2013
0K76LSE (London Stock Exchange)YesCommon StockGBUSDMay 2013
NRZ.PRANYSE (New York Stock Exchange)7.50% PFD SER AUSUSDJun 2019
NRZ.PRBNYSE (New York Stock Exchange)7.125% CUM PFD BUSUSDAug 2019
NRZ.PRCNYSE (New York Stock Exchange)6.375 PFD SER CUSUSDFeb 2020

Biography

New Residential Investment Corp., a real estate investment trust, focuses on investing in and managing residential mortgage related assets in the United States. It operates through Origination, Servicing, MSR Related Investments, Residential Securities and Loans, and Consumer Loans segments. The company invests in excess mortgage servicing rights (MSRs) on residential mortgage loans; and in servicer advances, including the basic fee component of the related MSRs. It also invests in real estate securities and residential mortgage loans, as well as in consumer loans, including unsecured and homeowner loans. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was founded in 2011 and is based in New York, New York. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/30 23:51
End of Day Share Price2020/03/30 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.