Redwood Trust (RWT)
Market Price (6/28/2026): $4.8 | Market Cap: $598.9 MilSector: Financials | Industry: Mortgage REITs
Redwood Trust (RWT)
Market Price (6/28/2026): $4.8Market Cap: $598.9 MilSector: FinancialsIndustry: Mortgage REITs
Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.
Attractive yieldDividend Yield is 16% Low stock price volatilityVol 12M is 36% Megatrend and thematic driversMegatrends include Digital & Alternative Assets. Themes include Private Credit. | Weak multi-year price returns2Y Excs Rtn is -38%, 3Y Excs Rtn is -62% | Debt is significantNet D/ENet Debt/Equity. Debt net of cash. Negative indicates net cash. Equity is taken as the Market Capitalization is 4132% Weak revenue growthRev Chg LTMRevenue Change % Last Twelve Months (LTM) is -47%, Rev Chg QQuarterly Revenue Change % is -24% Significant share based compensationSBC/Rev LTMShare Based Compensation / Revenue (Sales), Last Twelve Months (LTM) is 16% Not cash flow generativeCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is -10937%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is -10937% Yield minus risk free rate is negativeERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is -3.3% Key risksRWT key risks include [1] a liquidity shortfall that could force asset sales and threaten its REIT status, Show more. |
| Attractive yieldDividend Yield is 16% |
| Low stock price volatilityVol 12M is 36% |
| Megatrend and thematic driversMegatrends include Digital & Alternative Assets. Themes include Private Credit. |
| Weak multi-year price returns2Y Excs Rtn is -38%, 3Y Excs Rtn is -62% |
| Debt is significantNet D/ENet Debt/Equity. Debt net of cash. Negative indicates net cash. Equity is taken as the Market Capitalization is 4132% |
| Weak revenue growthRev Chg LTMRevenue Change % Last Twelve Months (LTM) is -47%, Rev Chg QQuarterly Revenue Change % is -24% |
| Significant share based compensationSBC/Rev LTMShare Based Compensation / Revenue (Sales), Last Twelve Months (LTM) is 16% |
| Not cash flow generativeCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is -10937%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is -10937% |
| Yield minus risk free rate is negativeERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is -3.3% |
| Key risksRWT key risks include [1] a liquidity shortfall that could force asset sales and threaten its REIT status, Show more. |
Qualitative Assessment
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Updated on 6/22/2026
Redwood Trust (RWT) stock has lost about 15% since 2/28/2026 because of the following key factors:
1. Redwood Trust reported a significant GAAP net loss and a decline in book value for fiscal Q1 2026. The company posted a GAAP net loss of $7.3 million, or $0.07 per share, for the quarter ended March 31, 2026, a reversal from the GAAP net income of $18 million ($0.13 per share) in the preceding fiscal quarter. Concurrently, book value per common share decreased by 3%, falling to $7.12 at March 31, 2026, from $7.36 at December 31, 2025.
2. The decline was largely driven by macroeconomic factors, specifically rising interest rates and increased market volatility, which negatively impacted portfolio valuations. The GAAP net loss in fiscal Q1 2026 was primarily due to non-cash, market-related valuation changes in Redwood Trust's investment portfolio. These valuation adjustments stemmed from widening in the To-Be-Announced (TBA) basis and credit spreads, along with the broader impact of higher interest rates experienced late in the fiscal quarter. This volatile environment adversely affected the fair value of retained securitization tranches.
Show more
Redwood Trust (RWT) stock has lost about 15% since 2/28/2026 because of the following key factors:
1. Redwood Trust reported a significant GAAP net loss and a decline in book value for fiscal Q1 2026. The company posted a GAAP net loss of $7.3 million, or $0.07 per share, for the quarter ended March 31, 2026, a reversal from the GAAP net income of $18 million ($0.13 per share) in the preceding fiscal quarter. Concurrently, book value per common share decreased by 3%, falling to $7.12 at March 31, 2026, from $7.36 at December 31, 2025.
2. The decline was largely driven by macroeconomic factors, specifically rising interest rates and increased market volatility, which negatively impacted portfolio valuations. The GAAP net loss in fiscal Q1 2026 was primarily due to non-cash, market-related valuation changes in Redwood Trust's investment portfolio. These valuation adjustments stemmed from widening in the To-Be-Announced (TBA) basis and credit spreads, along with the broader impact of higher interest rates experienced late in the fiscal quarter. This volatile environment adversely affected the fair value of retained securitization tranches.
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Updated on 6/22/2026
Redwood Trust (RWT) stock has lost about 15% since 2/28/2026 because of the following key factors:
1. Redwood Trust reported a significant GAAP net loss and a decline in book value for fiscal Q1 2026. The company posted a GAAP net loss of $7.3 million, or $0.07 per share, for the quarter ended March 31, 2026, a reversal from the GAAP net income of $18 million ($0.13 per share) in the preceding fiscal quarter. Concurrently, book value per common share decreased by 3%, falling to $7.12 at March 31, 2026, from $7.36 at December 31, 2025.
2. The decline was largely driven by macroeconomic factors, specifically rising interest rates and increased market volatility, which negatively impacted portfolio valuations. The GAAP net loss in fiscal Q1 2026 was primarily due to non-cash, market-related valuation changes in Redwood Trust's investment portfolio. These valuation adjustments stemmed from widening in the To-Be-Announced (TBA) basis and credit spreads, along with the broader impact of higher interest rates experienced late in the fiscal quarter. This volatile environment adversely affected the fair value of retained securitization tranches.
3. The CoreVest mortgage banking segment incurred one-time restructuring charges during fiscal Q1 2026. CoreVest reported a GAAP net loss of $3 million for the first fiscal quarter, which included approximately $5 million in one-time restructuring charges. These charges were associated with organizational changes designed to improve the segment's profitability later in fiscal 2026.
4. Analyst sentiment saw a notable price target revision, reflecting a potentially less optimistic outlook. On June 17, 2026, BTIG maintained its rating on Redwood Trust but revised its price target downward from $8.50 to $6.00. This adjustment by an analyst firm suggests a recalibrated expectation for the stock's future performance, which could contribute to negative investor sentiment.
Show less
Redwood Trust (RWT) stock has lost about 15% since 2/28/2026 because of the following key factors:
1. Redwood Trust reported a significant GAAP net loss and a decline in book value for fiscal Q1 2026. The company posted a GAAP net loss of $7.3 million, or $0.07 per share, for the quarter ended March 31, 2026, a reversal from the GAAP net income of $18 million ($0.13 per share) in the preceding fiscal quarter. Concurrently, book value per common share decreased by 3%, falling to $7.12 at March 31, 2026, from $7.36 at December 31, 2025.
2. The decline was largely driven by macroeconomic factors, specifically rising interest rates and increased market volatility, which negatively impacted portfolio valuations. The GAAP net loss in fiscal Q1 2026 was primarily due to non-cash, market-related valuation changes in Redwood Trust's investment portfolio. These valuation adjustments stemmed from widening in the To-Be-Announced (TBA) basis and credit spreads, along with the broader impact of higher interest rates experienced late in the fiscal quarter. This volatile environment adversely affected the fair value of retained securitization tranches.
3. The CoreVest mortgage banking segment incurred one-time restructuring charges during fiscal Q1 2026. CoreVest reported a GAAP net loss of $3 million for the first fiscal quarter, which included approximately $5 million in one-time restructuring charges. These charges were associated with organizational changes designed to improve the segment's profitability later in fiscal 2026.
4. Analyst sentiment saw a notable price target revision, reflecting a potentially less optimistic outlook. On June 17, 2026, BTIG maintained its rating on Redwood Trust but revised its price target downward from $8.50 to $6.00. This adjustment by an analyst firm suggests a recalibrated expectation for the stock's future performance, which could contribute to negative investor sentiment.
Show less
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Stock Movement Drivers
Fundamental Drivers
The -14.7% change in RWT stock from 2/28/2026 to 6/27/2026 was primarily driven by a -11.7% change in the company's Total Revenues ($ Mil).| (LTM values as of) | 2282026 | 6272026 | Change |
|---|---|---|---|
| Stock Price ($) | 5.64 | 4.81 | -14.7% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 131 | 116 | -11.7% |
| P/S Multiple | 5.4 | 5.2 | -4.6% |
| Shares Outstanding (Mil) | 126 | 125 | 1.2% |
| Cumulative Contribution | -14.7% |
Market Drivers
2/28/2026 to 6/27/2026| Return | Correlation | |
|---|---|---|
| RWT | -14.7% | |
| Market (SPY) | 6.6% | 48.7% |
| Sector (XLF) | 4.7% | 47.5% |
Fundamental Drivers
The -3.3% change in RWT stock from 11/30/2025 to 6/27/2026 was primarily driven by a -27.7% change in the company's P/S Multiple.| (LTM values as of) | 11302025 | 6272026 | Change |
|---|---|---|---|
| Stock Price ($) | 4.98 | 4.81 | -3.3% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 89 | 116 | 29.4% |
| P/S Multiple | 7.2 | 5.2 | -27.7% |
| Shares Outstanding (Mil) | 129 | 125 | 3.4% |
| Cumulative Contribution | -3.3% |
Market Drivers
11/30/2025 to 6/27/2026| Return | Correlation | |
|---|---|---|
| RWT | -3.3% | |
| Market (SPY) | 7.3% | 17.9% |
| Sector (XLF) | 1.3% | 13.9% |
Fundamental Drivers
The 4.2% change in RWT stock from 5/31/2025 to 6/27/2026 was primarily driven by a 84.8% change in the company's P/S Multiple.| (LTM values as of) | 5312025 | 6272026 | Change |
|---|---|---|---|
| Stock Price ($) | 4.62 | 4.81 | 4.2% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 218 | 116 | -47.0% |
| P/S Multiple | 2.8 | 5.2 | 84.8% |
| Shares Outstanding (Mil) | 133 | 125 | 6.4% |
| Cumulative Contribution | 4.2% |
Market Drivers
5/31/2025 to 6/27/2026| Return | Correlation | |
|---|---|---|
| RWT | 4.2% | |
| Market (SPY) | 25.1% | 25.4% |
| Sector (XLF) | 6.7% | 24.2% |
Fundamental Drivers
The 16.8% change in RWT stock from 5/31/2023 to 6/27/2026 was primarily driven by a -8.9% change in the company's Shares Outstanding (Mil).| (LTM values as of) | 5312023 | 6272026 | Change |
|---|---|---|---|
| Stock Price ($) | 4.12 | 4.81 | 16.8% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | -50 | 116 | -331.3% |
| P/S Multiple | -9.4 | 5.2 | -155.4% |
| Shares Outstanding (Mil) | 114 | 125 | -8.9% |
| Cumulative Contribution | 16.8% |
Market Drivers
5/31/2023 to 6/27/2026| Return | Correlation | |
|---|---|---|
| RWT | 16.8% | |
| Market (SPY) | 81.3% | 42.2% |
| Sector (XLF) | 77.0% | 42.1% |
Price Returns Compared
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | |
|---|---|---|---|---|---|---|---|
| Returns | |||||||
| RWT Return | 60% | -42% | 22% | -3% | -4% | -8% | -4% |
| Peers Return | 14% | -19% | 25% | 4% | 21% | -4% | 39% |
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | 7% | 96% |
Monthly Win Rates [3] | |||||||
| RWT Win Rate | 75% | 42% | 50% | 50% | 58% | 17% | |
| Peers Win Rate | 53% | 48% | 55% | 58% | 63% | 43% | |
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 50% | |
Max Drawdowns [4] | |||||||
| RWT Max Drawdown | -11% | -54% | -34% | -24% | -24% | -24% | |
| Peers Max Drawdown | -15% | -38% | -28% | -11% | -18% | -19% | |
| S&P 500 Max Drawdown | -5% | -25% | -10% | -8% | -19% | -9% | |
[1] Cumulative total returns since the beginning of 2021
[2] Peers: RITM, STWD, NLY, AGNC, PMT.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 6/26/2026 (YTD)
How Low Can It Go
| Event | RWT | S&P 500 |
|---|---|---|
| 2025 US Tariff Shock | ||
| % Loss | -20.3% | -18.8% |
| % Gain to Breakeven | 25.4% | 23.1% |
| Time to Breakeven | 21 days | 79 days |
| 2023 SVB Regional Banking Crisis | ||
| % Loss | -28.7% | -6.7% |
| % Gain to Breakeven | 40.3% | 7.1% |
| Time to Breakeven | 92 days | 31 days |
| 2015-2016 China Devaluation / Global Growth Scare | ||
| % Loss | -36.1% | -12.2% |
| % Gain to Breakeven | 56.5% | 13.9% |
| Time to Breakeven | 111 days | 62 days |
| 2014-2016 Oil Price Collapse | ||
| % Loss | -46.4% | -6.8% |
| % Gain to Breakeven | 86.6% | 7.3% |
| Time to Breakeven | 365 days | 15 days |
| 2013 Taper Tantrum | ||
| % Loss | -26.1% | -0.2% |
| % Gain to Breakeven | 35.3% | 0.2% |
| Time to Breakeven | 277 days | 1 days |
| 2011 US Debt Ceiling Crisis & European Contagion | ||
| % Loss | -30.0% | -17.9% |
| % Gain to Breakeven | 42.9% | 21.8% |
| Time to Breakeven | 319 days | 123 days |
In The Past
Redwood Trust's stock fell -20.3% during the 2025 US Tariff Shock. Such a loss loss requires a 25.4% gain to breakeven.
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Asset Allocation
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| Event | RWT | S&P 500 |
|---|---|---|
| 2025 US Tariff Shock | ||
| % Loss | -20.3% | -18.8% |
| % Gain to Breakeven | 25.4% | 23.1% |
| Time to Breakeven | 21 days | 79 days |
| 2023 SVB Regional Banking Crisis | ||
| % Loss | -28.7% | -6.7% |
| % Gain to Breakeven | 40.3% | 7.1% |
| Time to Breakeven | 92 days | 31 days |
| 2015-2016 China Devaluation / Global Growth Scare | ||
| % Loss | -36.1% | -12.2% |
| % Gain to Breakeven | 56.5% | 13.9% |
| Time to Breakeven | 111 days | 62 days |
| 2014-2016 Oil Price Collapse | ||
| % Loss | -46.4% | -6.8% |
| % Gain to Breakeven | 86.6% | 7.3% |
| Time to Breakeven | 365 days | 15 days |
| 2013 Taper Tantrum | ||
| % Loss | -26.1% | -0.2% |
| % Gain to Breakeven | 35.3% | 0.2% |
| Time to Breakeven | 277 days | 1 days |
| 2011 US Debt Ceiling Crisis & European Contagion | ||
| % Loss | -30.0% | -17.9% |
| % Gain to Breakeven | 42.9% | 21.8% |
| Time to Breakeven | 319 days | 123 days |
| 2008-2009 Global Financial Crisis | ||
| % Loss | -70.7% | -53.4% |
| % Gain to Breakeven | 240.8% | 114.4% |
| Time to Breakeven | 1575 days | 1085 days |
| Summer 2007 Credit Crunch | ||
| % Loss | -38.4% | -8.6% |
| % Gain to Breakeven | 62.3% | 9.5% |
| Time to Breakeven | 185 days | 47 days |
In The Past
Redwood Trust's stock fell -20.3% during the 2025 US Tariff Shock. Such a loss loss requires a 25.4% gain to breakeven.
Preserve Wealth
Limiting losses and compounding gains is essential to preserving wealth.
Asset Allocation
Actively managed asset allocation strategies protect wealth. Learn more.
About Redwood Trust (RWT)
Redwood Trust (RWT) is a specialty finance company operating as a real estate investment trust (REIT) focused on the U.S. housing market. The company primarily engages in mortgage banking activities, which involve acquiring and originating various types of residential and business purpose mortgage loans. These loans are then either sold, securitized into investment products, or retained within Redwood Trust's own investment portfolio.
The company's operations are divided into three key segments. Its Residential Mortgage Banking segment sources conventional residential loans from third-party originators, while its Business Purpose Mortgage Banking segment originates specialized loans for real estate investors, such as single-family rental and bridge loans. Both segments prepare these loans for onward sale, securitization, or internal investment, utilizing derivatives to manage associated market risks.
Redwood Trust's Investment Portfolio segment serves as a key component of its strategy, holding a diverse range of housing-related debt. This includes securities retained from its own securitization activities, direct investments in residential and small-balance multifamily bridge loans, and third-party mortgage-backed securities. As a REIT, Redwood Trust aims to distribute a significant portion of its taxable income as dividends to shareholders, offering investors exposure to the U.S. housing finance sector.
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Here are a few analogies for Redwood Trust (RWT):
- It's like a Fannie Mae or Freddie Mac, but focused on acquiring, packaging, and investing in a broader range of residential and business-purpose mortgages, rather than just standard conforming loans.
- Imagine an investment bank solely dedicated to the mortgage market, originating, securitizing, and investing in various types of real estate loans and mortgage-backed securities.
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- Residential Mortgage Banking: Acquiring residential mortgage loans from third-party originators for subsequent sale, securitization, or transfer to its investment portfolio.
- Business Purpose Mortgage Banking: Originating and acquiring business purpose loans, such as single-family rental and bridge loans, for subsequent securitization, sale, or transfer to its investment portfolio.
- Investment Portfolio Management: Investing in a diverse portfolio of housing-related debt and mortgage-backed securities, including those retained from its own securitization activities and those issued by third parties.
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Redwood Trust (RWT) primarily sells its financial products and services to other companies and institutional entities rather than individual consumers for their personal mortgage needs. Its major customer categories include:
- Institutional Investors: These are entities such as asset managers, hedge funds, banks, insurance companies, and pension funds that purchase the mortgage-backed securities (RMBS) and other securitized products (e.g., from business purpose loans) that Redwood Trust issues or sells. They also purchase whole loans from Redwood Trust.
- Real Estate Investment Entities: For its Business Purpose Mortgage Banking segment, Redwood Trust originates and acquires loans for real estate investors, developers, and landlords. These customers borrow funds for single-family rental properties, bridge loans for property acquisition/rehabilitation, and small-balance multifamily properties. These borrowers often operate as companies or professional investment entities.
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Christopher J. Abate, Chief Executive Officer
Mr. Abate has served as Chief Executive Officer of Redwood Trust since May 2018 and as a director since December 2017. He joined Redwood in April 2006, holding previous roles as the company's President from July 2016 to May 2018, Chief Financial Officer from March 2012 to August 2017, and Controller from January 2009 to March 2013. Before joining Redwood, Mr. Abate was employed by PricewaterhouseCoopers LLP. From October 2019 to December 2021, he served as Chair of the Board of Structured Finance Association, and in August 2025, he was named a member of the Board of Directors of Heritage Commerce Corp.
Brooke E. Carillo, Chief Financial Officer and Executive Vice President
Ms. Carillo joined Redwood Trust in May 2021. Prior to her tenure at Redwood, she was employed at Annaly Capital Management, Inc., where she most recently held the position of Head of Corporate Development and Strategy. In this role, Ms. Carillo was responsible for leading corporate strategy, capital markets, and investor relations departments, and she also served on Annaly's Operating Committee. Before joining Annaly in 2010, she worked in investment banking within the Financial Institutions Group at Bank of America Merrill Lynch.
Dashiell I. Robinson, President and Director
Mr. Robinson has served as President of Redwood Trust since December 2017 and as a director since August 2021. He joined Redwood in September 2017 from Wells Fargo Securities, where he was the Head of Mortgage Finance within the Asset-Backed Finance Group. Prior to his employment at Wells Fargo, Mr. Robinson worked within the Structured Credit Products Group at Wachovia Capital Markets from 2001 to 2008, where he held banking, structuring, and risk mitigation roles.
Abhinav Asthana, Chief Technology Officer
Mr. Asthana joined Redwood Trust as Chief Technology Officer in November 2024. He brings nearly two decades of experience in the technology and software industry, having most recently served as Head of Products at Tavant. His career also includes product leadership and engineering positions at Wipro and Hewlett-Packard.
Andrew P. Stone, Executive Vice President, Chief Legal Officer and Secretary
Mr. Stone serves as Executive Vice President, Chief Legal Officer, and Secretary for Redwood Trust.
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Redwood Trust (RWT) faces several significant risks due to its business model as a specialty finance company focused on the U.S. housing market. The primary risks stem from the inherent volatility of the financial and real estate sectors in which it operates.
The three most significant key risks to Redwood Trust's business are:
1. **Interest Rate Risk:** As a company heavily involved in mortgage banking, securitization, and maintaining an investment portfolio of mortgage-backed securities and loans, Redwood Trust is highly susceptible to interest rate fluctuations. Changes in interest rates can directly impact the value of its investment portfolio, particularly its fixed-income assets. Rising interest rates can lead to a decrease in the fair value of existing mortgage-backed securities, higher borrowing costs for the company's short-term credit lines, and potentially reduced demand for new mortgage originations, which are core to its business model. This risk can also lead to mark-to-market losses and affect the company's net interest income.
2. **Real Estate Market Downturn and Credit Risk:** Redwood Trust's profitability and asset values are intrinsically linked to the health of the residential and business-purpose real estate markets. A significant downturn in these markets, characterized by declining property values, increased loan defaults, or slower home price appreciation, could lead to substantial losses on its loan portfolios and securitized investments. The company's focus on non-agency mortgage loans means it bears the credit risk directly, and a rise in delinquency rates would severely impact its returns. Economic slowdowns or recessions are also a macro risk that could contribute to this.
3. **Liquidity and Capital Markets Access Risk:** Redwood Trust relies heavily on securitization and secondary markets to finance its mortgage originations and to manage its balance sheet by selling loans. A decrease in liquidity or disruptions in the secondary market for private-label securitizations could make it difficult for Redwood Trust to sell or securitize loans, leading to loans piling up on its balance sheet and increasing financing costs. This dependence on efficient capital markets for funding and distribution is critical for its operations and ability to recycle capital. A prolonged market disruption could widen credit spreads and negatively affect net interest margin.
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The addressable markets for Redwood Trust's main products and services in the United States are substantial across several key segments.
Residential Mortgage Banking
Redwood Trust operates in the U.S. residential mortgage market. The total U.S. mortgage market, representing outstanding mortgage debt, is approximately $14.5 trillion. More specifically, the U.S. mortgage originations market is projected to reach $2.27 trillion in 2026.
Business Purpose Mortgage Banking
This segment focuses on business purpose loans, including single-family rental (SFR) and bridge loans, primarily within the U.S.
- Single-Family Rental (SFR) Loans: The U.S. single-family rental market has a valuation of well over $4 trillion. There are approximately 15.0 million SFR units in the United States. The number of SFR households is estimated to have reached 14.6 million in 2025.
- Bridge Loans: The U.S. bridging finance market is estimated to be between $30 billion and $40 billion annually. This market is seeing increased activity, partly due to a projected $2 trillion "maturity wall" for commercial real estate borrowers through the end of 2026, leading to a greater reliance on short-term financing solutions like bridge loans.
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Redwood Trust (RWT) is expected to drive future revenue growth over the next 2-3 years through several key initiatives and market tailwinds:
- Expansion and Performance of Mortgage Banking Platforms: Redwood Trust anticipates continued growth in its core mortgage banking platforms, Sequoia, CoreVest, and Aspire. The company exited 2025 with record production and strong margins across its mortgage banking activities. Sequoia, the residential mortgage banking segment, saw a significant increase in loan locks in Q4 2025 compared to the prior year. The Aspire platform, focused on alternative loan products and non-QM loans, is expected to grow significantly, with plans to launch its inaugural securitization platform imminently and target a substantial share of its addressable market. CoreVest, which handles business purpose mortgage banking, has also shown growth, particularly with a shift towards smaller balance products like residential transition loans (RTL) and DSCR loans. These platforms generated a record $23 billion in volume in 2025, the highest in the company's history.
- Strategic Capital Reallocation and Reduced Legacy Asset Exposure: A significant driver of future earnings quality and growth is Redwood Trust's ongoing strategy to redeploy capital from legacy investments into its higher-return mortgage banking and operating segments. By the end of 2025, over 80% of the company's capital was invested in core operating and related activities, an increase from 57% in 2024. The company has actively harvested capital from legacy assets, aiming to reduce its legacy exposure to 20% of total capital by year-end 2025, which frees up capital for reinvestment in its scalable and profitable operating platforms.
- Product Diversification and Niche Market Penetration: Redwood Trust is expanding its product offerings and deepening its penetration in targeted market niches. The Aspire platform has been broadened to include diverse alternative loan products beyond home equity, such as loans verified by bank statements or CPA-prepared profit-and-loss statements, and DSCR loans for housing investors. The company is also scaling its Home Equity Investment (HEI) platform, with multiple HEI securitizations completed in 2025, which helps diversify revenue streams away from interest-rate-sensitive mortgage banking. Furthermore, CoreVest is focusing on the growing build-for-rent (BFR) sector, targeting institutional developers, a segment projected to grow about 15% annually through 2026.
- Operational Efficiencies and Technology Leverage: Enhanced operational efficiencies and the strategic adoption of technology are expected to contribute to revenue growth by improving profitability. In 2025, mortgage banking volumes grew approximately six times faster than total operating expenses, leading to a reduction in the total operating expense as a percentage of production volume. The company achieved a 44% year-over-year decrease in operating cost per loan due to automation and process improvements. Redwood's venture arm, RWT Horizons, invests in fintech and proptech, with adopted tools reducing loan processing times by up to 40% and improving credit risk assessment accuracy through machine learning, further reinforcing operating leverage.
- Favorable Interest Rate Environment and Rebounding Securitization Market: An anticipated environment of lower interest rates is expected to significantly benefit Redwood Trust. Lower rates are projected to enhance mortgage banking income and stimulate demand for whole loan sales. Additionally, the securitization market is showing signs of rebounding from periods of peak interest rate volatility, with deal flow normalizing. This market recovery, coupled with improved credit spreads, could lead to mark-to-market appreciation and further support a positive outlook for the company's investment portfolio and overall financial performance.
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Share Repurchases
- In July 2025, Redwood Trust's Board of Directors increased the common stock repurchase authorization to $150 million, with no specified time limit for the program. The authorization also covers repurchases of preferred stock and corporate debt securities.
- During 2025, the company repurchased 9.2 million shares of common stock for $53 million, contributing an accretion of $0.13 to book value per share.
- The company initiated common stock repurchases in the second quarter of 2025.
Share Issuance
- Shares outstanding at December 31, 2023, were 131,486,000, which was an increase from 113,485,000 at December 31, 2022, indicating share issuance during that period.
- In the fourth quarter of 2023, the net effects of equity issuance, alongside the common dividend, contributed to a decline in book value per share.
Outbound Investments
- Redwood Trust operates a venture investing initiative called RWT Horizons®, which focuses on investing in early-stage companies that have a direct connection to its core operating platforms.
- In the first quarter of 2024, Redwood Trust deployed approximately $115 million into internally sourced and third-party investments, representing the largest quarterly deployment since the third quarter of 2022.
- The company's Investment Portfolio segment strategically invests in a variety of assets, including securities retained from its residential and business purpose securitization activities, as well as residential and small-balance multifamily bridge loans and third-party issued residential mortgage-backed securities.
Capital Expenditures
- Redwood Trust reported $0.00 in capital expenditures for all years from 2015 to 2025.
Latest Trefis Analyses
| Title | |
|---|---|
| ARTICLES |
Research & Analysis
Invest in Strategies
Wealth Management
Peer Comparisons
| Peers to compare with: |
Financials
| Median | |
|---|---|
| Name | |
| Mkt Price | 10.84 |
| Mkt Cap | 5.7 |
| Rev LTM | 1,213 |
| Op Inc LTM | - |
| FCF LTM | -2,098 |
| FCF 3Y Avg | -514 |
| CFO LTM | -1,582 |
| CFO 3Y Avg | -492 |
Growth & Margins
| Median | |
|---|---|
| Name | |
| Rev Chg LTM | 24.9% |
| Rev Chg 3Y Avg | 82.2% |
| Rev Chg Q | 38.4% |
| QoQ Delta Rev Chg LTM | 3.0% |
| Op Inc Chg LTM | - |
| Op Inc Chg 3Y Avg | - |
| Op Mgn LTM | - |
| Op Mgn 3Y Avg | - |
| QoQ Delta Op Mgn LTM | - |
| CFO/Rev LTM | -51.6% |
| CFO/Rev 3Y Avg | -44.9% |
| FCF/Rev LTM | -73.1% |
| FCF/Rev 3Y Avg | -46.5% |
Segment Financials
Revenue by Segment| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Sequoia Mortgage Banking | 198 | 101 | 30 | -9 | 149 |
| Redwood Investments | 97 | 157 | 143 | 13 | 313 |
| CoreVest Mortgage Banking | 76 | 58 | 48 | 22 | 116 |
| Corporate/ Other | -64 | -71 | -55 | -33 | -37 |
| Legacy Investments | -131 | 12 | |||
| Total | 177 | 257 | 166 | -7 | 542 |
| $ Mil | 2015 | 2014 |
|---|---|---|
| Commercial Mortgage Banking and Investments | 0 | 0 |
| Corporate/ Other | 0 | 0 |
| Residential Investments | 0 | 0 |
| Sequoia Mortgage Banking | 0 | 0 |
| Total | 0 | 0 |
| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Sequoia Mortgage Banking | 126 | 61 | 10 | -22 | 82 |
| Redwood Investments | 68 | 133 | 114 | -9 | 293 |
| CoreVest Mortgage Banking | 20 | 2 | -13 | -44 | 39 |
| Corporate/ Other | -137 | -139 | -113 | -89 | -95 |
| Legacy Investments | -147 | -4 | |||
| Total | -70 | 54 | -2 | -164 | 320 |
| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Redwood Investments | 18,745 | 13,278 | 12,718 | 11,304 | 11,770 |
| Sequoia Mortgage Banking | 3,321 | 1,232 | 972 | 661 | 1,716 |
| Legacy Investments | 942 | 3,101 | |||
| CoreVest Mortgage Banking | 358 | 318 | 293 | 487 | 465 |
| Corporate/ Other | 335 | 330 | 521 | 579 | 755 |
| Total | 23,701 | 18,258 | 14,504 | 13,031 | 14,707 |
Price Behavior
Price Behavior
| Market Price | $4.81 | |
| Market Cap ($ Bil) | 0.6 | |
| First Trading Date | 08/04/1995 | |
| Distance from 52W High | -22.8% | |
| 50 Days | 200 Days | |
| DMA Price | $5.19 | $5.22 |
| DMA Trend | indeterminate | down |
| Distance from DMA | -7.4% | -7.9% |
| 3M | 1YR | |
| Volatility | 27.3% | 36.3% |
| Downside Capture | 102.74 | 81.81 |
| Upside Capture | 31.91 | 56.92 |
| Correlation (SPY) | 44.4% | 23.8% |
RWT Betas & Captures as of 5/31/2026
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
| 1M | 2M | 3M | 6M | 1Y | 3Y | |
|---|---|---|---|---|---|---|
| Beta | 0.54 | 1.10 | 1.30 | 0.61 | 0.80 | 0.94 |
| Up Beta | 0.44 | 1.15 | 1.12 | 0.93 | 1.29 | 1.00 |
| Down Beta | 1.71 | 1.48 | 1.57 | 0.10 | 0.25 | 0.88 |
| Up Capture | -3% | 34% | 85% | 61% | 70% | 69% |
| Bmk +ve Days | 13 | 28 | 36 | 67 | 141 | 432 |
| Stock +ve Days | 9 | 22 | 31 | 57 | 120 | 367 |
| Down Capture | 83% | 223% | 171% | 75% | 93% | 101% |
| Bmk -ve Days | 7 | 13 | 27 | 57 | 109 | 318 |
| Stock -ve Days | 9 | 16 | 29 | 62 | 118 | 354 |
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with RWT | |
|---|---|---|---|---|
| RWT | -3.9% | 36.2% | -0.05 | - |
| Sector ETF (XLF) | 5.5% | 14.5% | 0.15 | 22.9% |
| Equity (SPY) | 21.2% | 12.4% | 1.26 | 23.7% |
| Gold (GLD) | 21.8% | 27.7% | 0.70 | 13.1% |
| Commodities (DBC) | 21.8% | 18.6% | 0.92 | -16.1% |
| Real Estate (VNQ) | 16.1% | 13.6% | 0.85 | 42.0% |
| Bitcoin (BTCUSD) | -44.2% | 42.5% | -1.25 | 13.2% |
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Based On 5-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with RWT | |
|---|---|---|---|---|
| RWT | -7.3% | 35.1% | -0.14 | - |
| Sector ETF (XLF) | 10.7% | 18.6% | 0.44 | 47.3% |
| Equity (SPY) | 13.4% | 17.1% | 0.61 | 49.3% |
| Gold (GLD) | 17.8% | 18.3% | 0.79 | 14.4% |
| Commodities (DBC) | 7.4% | 19.5% | 0.28 | 9.6% |
| Real Estate (VNQ) | 3.4% | 18.9% | 0.08 | 57.2% |
| Bitcoin (BTCUSD) | 10.9% | 54.0% | 0.39 | 21.2% |
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Based On 10-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with RWT | |
|---|---|---|---|---|
| RWT | -1.4% | 49.0% | 0.15 | - |
| Sector ETF (XLF) | 13.3% | 22.1% | 0.55 | 38.4% |
| Equity (SPY) | 15.2% | 18.0% | 0.72 | 36.0% |
| Gold (GLD) | 11.8% | 16.1% | 0.60 | 1.4% |
| Commodities (DBC) | 5.9% | 18.0% | 0.26 | 11.8% |
| Real Estate (VNQ) | 5.6% | 20.7% | 0.23 | 46.1% |
| Bitcoin (BTCUSD) | 54.7% | 66.4% | 0.95 | 10.1% |
Smart multi-asset allocation framework can stack odds in your favor. Learn How
Returns Analyses
Earnings Returns History
Updated 6/2/2026| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 4/29/2026 | -0.9% | -0.7% | -3.4% |
| 2/11/2026 | 20.6% | 13.0% | 5.2% |
| 10/29/2025 | -2.7% | -4.4% | 1.6% |
| 7/30/2025 | -7.9% | -6.4% | -1.2% |
| 4/30/2025 | -6.1% | -6.0% | -12.2% |
| 2/13/2025 | -1.2% | -0.3% | -1.2% |
| 10/30/2024 | -4.2% | -6.8% | -6.3% |
| 8/1/2024 | -2.8% | -4.1% | 3.3% |
| ... | |||
| SUMMARY STATS | |||
| # Positive | 8 | 6 | 12 |
| # Negative | 16 | 18 | 12 |
| Median Positive | 6.4% | 9.1% | 4.9% |
| Median Negative | -2.7% | -4.5% | -4.8% |
| Max Positive | 20.6% | 14.5% | 12.9% |
| Max Negative | -8.6% | -16.2% | -14.0% |
| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 4/29/2026 | -0.9% | -0.7% | -3.4% |
| 2/11/2026 | 20.6% | 13.0% | 5.2% |
| 10/29/2025 | -2.7% | -4.4% | 1.6% |
| 7/30/2025 | -7.9% | -6.4% | -1.2% |
| 4/30/2025 | -6.1% | -6.0% | -12.2% |
| 2/13/2025 | -1.2% | -0.3% | -1.2% |
| 10/30/2024 | -4.2% | -6.8% | -6.3% |
| 8/1/2024 | -2.8% | -4.1% | 3.3% |
| 4/30/2024 | 11.8% | 14.5% | 12.8% |
| 2/20/2024 | -5.7% | -6.5% | -0.5% |
| 10/30/2023 | -8.6% | -1.0% | 3.6% |
| 7/27/2023 | 8.1% | 6.8% | 12.9% |
| 4/27/2023 | -5.1% | -16.2% | -11.0% |
| 2/9/2023 | -0.5% | 1.1% | -14.0% |
| 10/27/2022 | 5.5% | -3.2% | 10.8% |
| 7/28/2022 | -1.5% | -8.0% | -7.4% |
| 4/28/2022 | 7.2% | 11.4% | 12.8% |
| 2/9/2022 | -8.4% | -11.8% | -11.7% |
| 10/27/2021 | 3.0% | -0.7% | -0.7% |
| 7/28/2021 | 2.6% | -0.7% | 4.6% |
| 4/28/2021 | -0.4% | 4.2% | 1.7% |
| 2/10/2021 | 2.3% | -4.5% | 9.9% |
| 10/29/2020 | -1.3% | -2.3% | 0.5% |
| 7/31/2020 | -1.0% | -5.3% | -2.8% |
| SUMMARY STATS | |||
| # Positive | 8 | 6 | 12 |
| # Negative | 16 | 18 | 12 |
| Median Positive | 6.4% | 9.1% | 4.9% |
| Median Negative | -2.7% | -4.5% | -4.8% |
| Max Positive | 20.6% | 14.5% | 12.9% |
| Max Negative | -8.6% | -16.2% | -14.0% |
SEC Filings
Expand for More| Report Date | Filing Date | Filing |
|---|---|---|
| 03/31/2026 | 05/07/2026 | 10-Q |
| 12/31/2025 | 02/27/2026 | 10-K |
| 09/30/2025 | 11/07/2025 | 10-Q |
| 06/30/2025 | 08/08/2025 | 10-Q |
| 03/31/2025 | 05/09/2025 | 10-Q |
| 12/31/2024 | 03/03/2025 | 10-K |
| 09/30/2024 | 11/07/2024 | 10-Q |
| 06/30/2024 | 08/07/2024 | 10-Q |
| 03/31/2024 | 05/08/2024 | 10-Q |
| 12/31/2023 | 02/29/2024 | 10-K |
| 09/30/2023 | 11/07/2023 | 10-Q |
| 06/30/2023 | 08/07/2023 | 10-Q |
| 03/31/2023 | 05/05/2023 | 10-Q |
| 12/31/2022 | 03/01/2023 | 10-K |
| 09/30/2022 | 11/07/2022 | 10-Q |
| 06/30/2022 | 08/05/2022 | 10-Q |
| Report Date | Filing Date | Filing |
|---|---|---|
| 03/31/2026 | 05/07/2026 | 10-Q |
| 12/31/2025 | 02/27/2026 | 10-K |
| 09/30/2025 | 11/07/2025 | 10-Q |
| 06/30/2025 | 08/08/2025 | 10-Q |
| 03/31/2025 | 05/09/2025 | 10-Q |
| 12/31/2024 | 03/03/2025 | 10-K |
| 09/30/2024 | 11/07/2024 | 10-Q |
| 06/30/2024 | 08/07/2024 | 10-Q |
| 03/31/2024 | 05/08/2024 | 10-Q |
| 12/31/2023 | 02/29/2024 | 10-K |
| 09/30/2023 | 11/07/2023 | 10-Q |
| 06/30/2023 | 08/07/2023 | 10-Q |
| 03/31/2023 | 05/05/2023 | 10-Q |
| 12/31/2022 | 03/01/2023 | 10-K |
| 09/30/2022 | 11/07/2022 | 10-Q |
| 06/30/2022 | 08/05/2022 | 10-Q |
| 03/31/2022 | 05/06/2022 | 10-Q |
| 12/31/2021 | 02/25/2022 | 10-K |
| 09/30/2021 | 11/04/2021 | 10-Q |
| 06/30/2021 | 08/04/2021 | 10-Q |
| 03/31/2021 | 05/07/2021 | 10-Q |
| 12/31/2020 | 02/26/2021 | 10-K |
| 09/30/2020 | 11/06/2020 | 10-Q |
| 06/30/2020 | 08/10/2020 | 10-Q |
| 03/31/2020 | 05/15/2020 | 10-Q |
| 12/31/2019 | 03/02/2020 | 10-K |
| 09/30/2019 | 11/08/2019 | 10-Q |
| 06/30/2019 | 08/08/2019 | 10-Q |
External Quote Links
| Y Finance | Barrons |
| TradingView | Morningstar |
| SeekingAlpha | ValueLine |
| Motley Fool | Robinhood |
| CNBC | Etrade |
| MarketWatch | Unusual Whales |
| YCharts | Perplexity Finance |
| FinViz |
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Core Cache Last Updated: 6/27/2026