| Snowflake Score | |
|---|---|
| Valuation | 4/6 |
| Future Growth | 0/6 |
| Past Performance | 3/6 |
| Financial Health | 1/6 |
| Dividends | 2/6 |
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
Price History & Performance
| Historical stock prices | |
|---|---|
| Current Share Price | US$64.62 |
| 52 Week High | US$71.52 |
| 52 Week Low | US$55.11 |
| Beta | 1.2 |
| 1 Month Change | -7.79% |
| 3 Month Change | 3.82% |
| 1 Year Change | 12.46% |
| 3 Year Change | 212.33% |
| 5 Year Change | 280.12% |
| Change since IPO | 229.69% |
Recent News & Updates
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
| PFSI | US Mortgage | US Market | |
|---|---|---|---|
| 7D | -4.2% | -3.3% | -5.1% |
| 1Y | 12.5% | -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
| PFSI volatility | |
|---|---|
| PFSI Average Weekly Movement | 3.4% |
| Mortgage Industry Average Movement | 3.8% |
| Market Average Movement | 6.7% |
| 10% most volatile stocks in US Market | 15.4% |
| 10% least volatile stocks in US Market | 2.4% |
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
| Founded | Employees | CEO | Website |
|---|---|---|---|
| 2008 | 7,261 | David Spector | https://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
| PFSI fundamental statistics | |
|---|---|
| Market Cap | US$3.81b |
| Earnings (TTM) | US$1.28b |
| Revenue (TTM) | US$3.90b |
3.0x
P/E Ratio1.1x
P/B RatioIs PFSI overvalued?
See Fair Value and valuation analysisEarnings & Revenue
| PFSI income statement (TTM) | |
|---|---|
| Revenue | US$3.90b |
| Cost of Revenue | US$478.59m |
| Gross Profit | US$3.42b |
| Expenses | US$2.14b |
| Earnings | US$1.28b |
Last Reported Earnings
Sep 30, 2021
Next Earnings Date
n/a
| Earnings per share (EPS) | 21.74 |
| Gross Margin | 87.74% |
| Net Profit Margin | 32.89% |
| Debt/Equity Ratio | 423.7% |
How did PFSI perform over the long term?
See historical performance and comparisonDividends
1.2%
Current Dividend Yield4%
Payout RatioValuation
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
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2022/01/27 00:10 |
| End of Day Share Price | 2022/01/26 00:00 |
| Earnings | 2021/09/30 |
| Annual Earnings | 2020/12/31 |
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.