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PennyMac Financial Services (PFSI) Q2 Earnings: What To Expect

PFSI Cover Image

Mortgage banking company PennyMac Financial Services (NYSE: PFSI) will be reporting results this Tuesday afternoon. Here’s what investors should know.

PennyMac Financial Services beat analysts’ revenue expectations by 1.8% last quarter, reporting revenues of $529.6 million, up 23.1% year on year. It was a slower quarter for the company, with a miss of analysts’ tangible book value per share and EPS estimates.

Is PennyMac Financial Services a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting PennyMac Financial Services’s revenue to grow 16% year on year to $554.8 million, slowing from the 29.7% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $3.07 per share.

PennyMac Financial Services Total Revenue

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. PennyMac Financial Services has a history of exceeding Wall Street’s expectations, beating revenue estimates every single time over the past two years by 5.5% on average.

Looking at PennyMac Financial Services’s peers in the banks segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Citigroup delivered year-on-year revenue growth of 8%, beating analysts’ expectations by 3.5%, and Texas Capital Bank reported revenues up 15.2%, topping estimates by 2.7%. Citigroup traded up 2.9% following the results while Texas Capital Bank was also up 4.8%.

Read our full analysis of Citigroup’s results here and Texas Capital Bank’s results here.

There has been positive sentiment among investors in the banks segment, with share prices up 7.7% on average over the last month. PennyMac Financial Services is up 4% during the same time and is heading into earnings with an average analyst price target of $125.13 (compared to the current share price of $100.85).

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