Dj Ceo Steinberg Buys 67869 Of Wisdomtree Inc >Wt

Shares of Rithm Capital Corp. RITM have gained 3.3% since it reported better-than-expected third-quarter 2024 earnings on Oct. 29, 2024, driven by an improving performance in its Mortgage Loans Receivable business and solid Asset Management unit.

Higher interest income was a key contributor to third-quarter growth, though rising expenses and declining servicing revenues partially offset these gains. Still, Rithm’s expanding Newrez business and strategic initiatives are expected to boost the market share of its origination platform, presenting significant growth opportunities for investors.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

Now, let’s take a look at how RITM performed in the third quarter.

RITM’s Q3 Performance

RITM reported third-quarter 2024 adjusted earnings of 54 cents per share, which outpaced the Zacks Consensus Estimate of 43 cents. However, the bottom line fell 6.9% year over year.

Revenues amounted to almost $619.5 million, which plunged 45.4% year over year in the quarter under review. The top line also missed the consensus mark by 44.4%.

Rithm Capital Corp. Price, Consensus and EPS Surprise

Rithm Capital Corp. price-consensus-eps-surprise-chart | Rithm Capital Corp. Quote

Let’s delve deeper.

Net servicing revenues of Rithm Capital were negative $254.2 million, which deteriorated 154.9% year over year in the third quarter and missed the Zacks Consensus Estimate by 180.8% due to changes to the fair value of the MSR portfolio.Interest income increased 19.1% year over year to $550.7 million and beat the consensus mark by 12.9%.

Gain on originated residential mortgage loans, held for sale, net, rose 23.8% year over year to $184.7 million and beat the consensus estimate by 9.9%. Asset management revenues of $81 million missed the Zacks Consensus Estimate by 4.7%.

Total expenses of $983.9 million increased 30.4% year over year in the quarter under review due to higher interest expenses and warehouse line fees, G&A expenses and compensation and benefits.

RITM’s pretax income fell to $45.1 million in the third quarter from $273.8 million a year ago.

Q3 Segmental Update

Origination and Servicing: Net servicing revenues amounted to negative $241 million, declining from $468.5 million in the prior-year quarter. The segment’s interest income of $211.6 million rose from $156.6 million a year ago. The segment’s revenues of $142.3 million fell from $769.2 million year over year. Pre-tax loss came in at $312.3 million against pre-tax income of $412.5 million a year ago.

Investment Portfolio: The segment’s net servicing revenues of negative $13.1 million deteriorated from negative $5.1 million in the year-ago quarter. Interest income was $267.6 million, up from $255.8 million a year ago. Total revenues increased to $324.6 million from $316 million a year ago. Pre-tax earnings came in at $361.3 million, improving from a loss of $108.3 million in the prior quarter.

Mortgage Loans Receivable: Revenues of $66.3 million advanced from $50.1 million. The unit’s pre-tax income was $35.1 million compared with $19 million in the prior-year quarter.

Asset Management: Total revenues came in at $86.3 million in the third quarter of 2024. Pre-tax income was $6 million in the quarter under review.

Financial Update (as of Sept. 30, 2024)

Rithm Capital exited the third quarter with cash and cash equivalents of $1.64 billion, which increased from the 2023-end level of $1.29 billion. Total assets of $42.28 billion rose from $39.72 billion at 2023-end.

Unsecured notes, net of issuance costs,amounted to $1.2 billion, up from around $719 million at 2023-end.

Total equity of $7.75 billion increased from $7.1 billion at 2023-end.

Net cash used in operations was $431.8 million in the first nine months of 2024 against net cash from operations of $1.74 billion a year ago.

Capital-Deployment Update

Rithm Capital did not buy back any shares in the first nine months of 2024. It has a share repurchase program of $200 million common stock in place through Dec. 31, 2024. Management paid out a quarterly common dividend of 25 cents per share, totaling $129.9 million.

Zacks Rank & Other Key Picks

Rithm Capital currently has a Zacks Rank #2 (Buy).

Investors interested in the broader Finance space may look at some other top-ranked players like Jackson Financial Inc. JXN, WisdomTree, Inc. WT and Houlihan Lokey, Inc. HLI. While Jackson Financial currently sports a Zacks Rank #1 (Strong Buy), WisdomTree and Houlihan Lokey carry a Zacks Rank #2 each. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Jackson Financial’s current-year earnings is pegged at $18.85 per share, which indicates 46.8% year-over-year growth. It witnessed one upward estimate revision in the past 30 days against no downward movement. The consensus mark for JXN’s current year revenues suggests a 118.5% surge from a year ago.

The Zacks Consensus Estimate for WisdomTree’s 2024 earnings indicates 75.7% year-over-year growth. During the past month, WT has witnessed three upward estimate revisions against none in the opposite direction. It beat earnings estimates thrice in the past four quarters and met once, with an average surprise of 7.3%.

The Zacks Consensus Estimate for Houlihan Lokey’s current-year earnings suggests a 29% year-over-year increase. During the past month, HLIhas witnessed two upward estimate revisions against none in the opposite direction. The consensus mark for current-year revenues is pegged at $2.3 million, indicating a 19.6% increase from a year ago.

Zacks Investment Research

Growth investors focus on stocks that are seeing above-average financial growth, as this feature helps these securities garner the market's attention and deliver solid returns. But finding a great growth stock is not easy at all.

By their very nature, these stocks carry above-average risk and volatility. Moreover, if a company's growth story is over or nearing its end, betting on it could lead to significant loss.

However, the task of finding cutting-edge growth stocks is made easy with the help of the Zacks Growth Style Score (part of the Zacks Style Scores system), which looks beyond the traditional growth attributes to analyze a company's real growth prospects.

WisdomTree, Inc. (WT) is one such stock that our proprietary system currently recommends. The company not only has a favorable Growth Score, but also carries a top Zacks Rank.

Research shows that stocks carrying the best growth features consistently beat the market. And for stocks that have a combination of a Growth Score of A or B and a Zacks Rank #1 (Strong Buy) or 2 (Buy), returns are even better.

While there are numerous reasons why the stock of this company is a great growth pick right now, we have highlighted three of the most important factors below:

Earnings Growth

Earnings growth is arguably the most important factor, as stocks exhibiting exceptionally surging profit levels tend to attract the attention of most investors. For growth investors, double-digit earnings growth is highly preferable, as it is often perceived as an indication of strong prospects (and stock price gains) for the company under consideration.

While the historical EPS growth rate for WisdomTree, Inc. is 13.5%, investors should actually focus on the projected growth. The company's EPS is expected to grow 74.8% this year, crushing the industry average, which calls for EPS growth of 13.7%.

Impressive Asset Utilization Ratio

Asset utilization ratio -- also known as sales-to-total-assets (S/TA) ratio -- is often overlooked by investors, but it is an important indicator in growth investing. This metric exhibits how efficiently a firm is utilizing its assets to generate sales.

Right now, WisdomTree, Inc. has an S/TA ratio of 0.42, which means that the company gets $0.42 in sales for each dollar in assets. Comparing this to the industry average of 0.22, it can be said that the company is more efficient.

While the level of efficiency in generating sales matters a lot, so does the sales growth of a company. And WisdomTree, Inc. looks attractive from a sales growth perspective as well. The company's sales are expected to grow 23% this year versus the industry average of 0%.

Promising Earnings Estimate Revisions

Beyond the metrics outlined above, investors should consider the trend in earnings estimate revisions. A positive trend is a plus here. Empirical research shows that there is a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

There have been upward revisions in current-year earnings estimates for WisdomTree, Inc. The Zacks Consensus Estimate for the current year has surged 4.3% over the past month.

Bottom Line

WisdomTree, Inc. has not only earned a Growth Score of B based on a number of factors, including the ones discussed above, but it also carries a Zacks Rank #2 because of the positive earnings estimate revisions.

You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

This combination positions WisdomTree, Inc. well for outperformance, so growth investors may want to bet on it.

Zacks Investment Research

Blue Owl Capital Corporation OBDC reported third-quarter 2024 earnings per share (EPS) of 47 cents, which missed the Zacks Consensus Estimate by a penny. The bottom line declined by 2 cents from a year ago.

The total investment income of Blue Owl Capital amounted to $406.03 million, which increased 1.8% year over year. Also, the top line beat the Zacks Consensus Estimate by 1.6%.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

Blue Owl Capital’s weak third-quarter earnings were due to higher expenses and lower interest income from non-controlled, non-affiliated investments. The negatives were partially offset by higher investment income from controlled, affiliated investments.

Blue Owl Capital Corporation Price, Consensus and EPS Surprise

Blue Owl Capital Corporation price-consensus-eps-surprise-chart | Blue Owl Capital Corporation Quote

OBDC’s Q3 Update

Net investment income decreased 2.7% year over year to $184.9 million. Also, the metric missed our estimate of $188.9 million. Total new investment commitments (net of sell-downs) were $1.2 billion across 23 new portfolio companies and 14 existing ones.

Blue Owl Capital ended the third quarter with investments in 219 portfolio companies, backed with an aggregate fair value of $13.4 billion. Based on the fair value, the average investment size in each portfolio company was $61.4 million as of Sept. 30, 2024.

Total expenses increased 5.5% from the year-ago period to $217.6 million in the third quarter. The metric was higher than our estimate of $208.9 million, primarily due to higher interest expenses, management fees and other G&A expenses.

The company recorded a net income of $135.4 million in the third quarter compared with $206.9 million in the year-ago period.

Financial Update (as of Sept. 30, 2024)

Blue Owl Capital exited the third quarter with a cash balance of $481.3 million, which declined from $658.7 million as of Dec. 31, 2023. Total assets of $14.09 billion rose from $13.51 billion at 2023-end.

Debt was $7.74 billion, up from $7.08 billion at 2023-end. Blue Owl Capital had $1.6 billion of undrawn capacity under its credit facilities. At the third-quarter end, net debt to equity was 1.23X.

Net cash used in operating activities in the first nine months of 2024 was $285.74 million against the prior-year operating cash flow figure of $721.75 million.

Dividend & Repurchase Update

The board of directors at Blue Owl Capital declared a fourth-quarter 2024 dividend of 37 cents per share, to be paid on or before Jan. 15, 2025, to shareholders of record as of Dec. 31, 2024. It also provided a third-quarter 2024 supplemental dividend of 5 cents per share.

Blue Owl Capital’s board earlier approved a new share repurchase plan for 2024, under which the company may purchase shares up to $150 million. It did not make share repurchases under this program in the third quarter.

Zacks Rank & Key Picks

OBDC currently has a Zacks Rank #4 (Sell).

Investors interested in the broader Finance space may look at some better-ranked players like Jackson Financial Inc. JXN, WisdomTree, Inc. WT and Globe Life Inc. GL, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Jackson Financial’s current-year earnings is pegged at $18.79 per share, which indicates 46.3% year-over-year growth. It witnessed one upward estimate revision in the past 30 days against no downward movement. The consensus mark for JXN’s current year revenues suggests a 117.5% surge from a year ago.

The Zacks Consensus Estimate for WisdomTree’s 2024 earnings indicates 75.7% year-over-year growth. During the past month, WT has witnessed three upward estimate revisions against none in the opposite direction. It beat earnings estimates thrice in the past four quarters and met once, with an average surprise of 7.3%.

The Zacks Consensus Estimate for Globe Life’s current-year earnings suggests a 15.1% year-over-year increase. During the past month, GLhas witnessed five upward estimate revisions against none in the opposite direction. The consensus mark for current-year revenues is pegged at $5.8 billion, a 5.6% increase from a year ago.

Zacks Investment Research