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PFSI

PennyMac Financial ServicesNYSE:PFSI Stock Report

Last Price

US$64.62

Market Cap

US$3.8b

7D

-4.2%

1Y

12.5%

Updated

27 Jan, 2022

Data

Company Financials +
PFSI fundamental analysis
Snowflake Score
Valuation4/6
Future Growth0/6
Past Performance3/6
Financial Health1/6
Dividends2/6

PFSI Stock Overview

PennyMac Financial Services, Inc., through its subsidiaries, engages in the mortgage banking and investment management activities in the United States.

PennyMac Financial Services Competitors

Rocket Companies

NYSE:RKT

US$25.7b

MGIC Investment

NYSE:MTG

US$5.0b

Radian Group

NYSE:RDN

US$4.1b

Mr. Cooper Group

NasdaqCM:COOP

US$3.1b

Price History & Performance

Summary of all time highs, changes and price drops for PennyMac Financial Services
Historical stock prices
Current Share PriceUS$64.62
52 Week HighUS$71.52
52 Week LowUS$55.11
Beta1.2
1 Month Change-7.79%
3 Month Change3.82%
1 Year Change12.46%
3 Year Change212.33%
5 Year Change280.12%
Change since IPO229.69%

Recent News & Updates

Jan 07

The Prognosis For PennyMac Financial Services

On its way to posting another exceptional year, mortgage producer PennyMac Financial Services, Inc. is trading at just over five times FY22E earnings per share. Inflation fears and competitive pressures are largely to blame. With a massive share repurchase program, a significant foray into the high-margin consumer direct channel, and insider buying, PennyMac merited a closer examination. A full investment analysis and recommendation follows in the paragraphs below.

Shareholder Returns

PFSIUS MortgageUS Market
7D-4.2%-3.3%-5.1%
1Y12.5%-12.9%3.3%

Return vs Industry: PFSI exceeded the US Mortgage industry which returned -12.9% over the past year.

Return vs Market: PFSI exceeded the US Market which returned 3.3% over the past year.

Price Volatility

Is PFSI's price volatile compared to industry and market?
PFSI volatility
PFSI Average Weekly Movement3.4%
Mortgage Industry Average Movement3.8%
Market Average Movement6.7%
10% most volatile stocks in US Market15.4%
10% least volatile stocks in US Market2.4%

Stable Share Price: PFSI is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: PFSI's weekly volatility (3%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
20087,261David Spectorhttps://ir.pennymacfinancial.com

PennyMac Financial Services, Inc., through its subsidiaries, engages in the mortgage banking and investment management activities in the United States. It operates through three segments: Production, Servicing, and Investment Management. The Production segment is involved in the origination, acquisition, and sale of loans.

PennyMac Financial Services Fundamentals Summary

How do PennyMac Financial Services's earnings and revenue compare to its market cap?
PFSI fundamental statistics
Market CapUS$3.81b
Earnings (TTM)US$1.28b
Revenue (TTM)US$3.90b

3.0x

P/E Ratio

1.1x

P/B Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
PFSI income statement (TTM)
RevenueUS$3.90b
Cost of RevenueUS$478.59m
Gross ProfitUS$3.42b
ExpensesUS$2.14b
EarningsUS$1.28b

Last Reported Earnings

Sep 30, 2021

Next Earnings Date

n/a

Earnings per share (EPS)21.74
Gross Margin87.74%
Net Profit Margin32.89%
Debt/Equity Ratio423.7%

How did PFSI perform over the long term?

See historical performance and comparison

Dividends

1.2%

Current Dividend Yield

4%

Payout Ratio

Valuation

Is PennyMac Financial Services 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: PFSI ($64.62) is trading below our estimate of fair value ($236.61)

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


Price To Earnings Ratio

PE vs Industry: PFSI is good value based on its PE Ratio (3x) compared to the US Mortgage industry average (12.8x).

PE vs Market: PFSI is good value based on its PE Ratio (3x) compared to the US market (16.4x).


Price to Earnings Growth Ratio

PEG Ratio: PFSI's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: PFSI's PB Ratio (1.1x) is in line with the US Mortgage industry average.


Future Growth

How is PennyMac Financial Services forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

-19.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PFSI's earnings are forecast to decline over the next 3 years (-19% per year).

Earnings vs Market: PFSI's earnings are forecast to decline over the next 3 years (-19% per year).

High Growth Earnings: PFSI's earnings are forecast to decline over the next 3 years.

Revenue vs Market: PFSI's revenue is expected to decline over the next 3 years (-15.3% per year).

High Growth Revenue: PFSI's revenue is forecast to decline over the next 3 years (-15.3% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PFSI's Return on Equity is forecast to be low in 3 years time (18.1%).


Past Performance

How has PennyMac Financial Services performed over the past 5 years?

65.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PFSI has high quality earnings.

Growing Profit Margin: PFSI's current net profit margins (32.9%) are higher than last year (30.2%).


Past Earnings Growth Analysis

Earnings Trend: PFSI's earnings have grown significantly by 65.1% per year over the past 5 years.

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

Earnings vs Industry: PFSI had negative earnings growth (-4.7%) over the past year, making it difficult to compare to the Mortgage industry average (32%).


Return on Equity

High ROE: Whilst PFSI's Return on Equity (36.62%) is high, this metric is skewed due to their high level of debt.


Financial Health

How is PennyMac Financial Services'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


Financial Institutions Analysis

Asset Level: PFSI's Assets to Equity ratio (5.6x) is low.

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

Low Risk Liabilities: PFSI reports no customer deposits, 100% of its liabilities are made up of higher risk sources of funding.

Loan Level: Insufficient data to determine if PFSI has an appropriate level of Loans to Assets ratio.

Low Risk Deposits: PFSI reports no customer deposits, loans are made up entirely of externally borrowed funds.

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


Dividend

What is PennyMac Financial Services's current dividend yield, its reliability and sustainability?

1.24%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: PFSI's dividend (1.24%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.36%).

High Dividend: PFSI's dividend (1.24%) is low compared to the top 25% of dividend payers in the US market (3.56%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, PFSI has been paying a dividend for less than 10 years.

Growing Dividend: PFSI's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (4.2%), PFSI's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: PFSI's dividends in 3 years are forecast to be thoroughly covered by earnings (6.9% payout ratio).


Next Steps

Management

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

2.2yrs

Average management tenure


CEO

David Spector (58 yo)

5yrs

Tenure

US$12,375,328

Compensation

Mr. David A. Spector has been the Chief Executive Officer of PennyMac Financial Services, Inc. since January 1, 2017. He served as President at PennyMac Financial Services, Inc. since February 2013 to Febr...


CEO Compensation Analysis

Compensation vs Market: David's total compensation ($USD12.38M) is above average for companies of similar size in the US market ($USD5.25M).

Compensation vs Earnings: David's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

Experienced Management: PFSI's management team is considered experienced (2.2 years average tenure).


Board Members

Experienced Board: PFSI's board of directors are considered experienced (7.5 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

PennyMac Financial Services, Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: PennyMac Financial Services, Inc.
  • Ticker: PFSI
  • Exchange: NYSE
  • Founded: 2008
  • Industry: Thrifts and Mortgage Finance
  • Sector: Banks
  • Implied Market Cap: US$3.814b
  • Shares outstanding: 59.03m
  • Website: https://ir.pennymacfinancial.com

Number of Employees


Location

  • PennyMac Financial Services, Inc.
  • 3043 Townsgate Road
  • Westlake Village
  • California
  • 91361
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/01/27 00:10
End of Day Share Price2022/01/26 00:00
Earnings2021/09/30
Annual Earnings2020/12/31


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.