Redwood Trust, Inc. functions as a specialized financial institution throughout the United States. Its operations are divided into three primary areas: Residential ...
Redwood Trust, Inc. is a leading participant in several distinct areas of housing credit in the United States. The company was founded in 1994 by George Bull and Doug Hansen, along with Frederick Borden, and completed its IPO in the same year. Headquartered in Mill Valley, California, Redwood Trust is ...Redwood Trust, Inc. is a leading participant in several distinct areas of housing credit in the United States. The company was founded in 1994 by George Bull and Doug Hansen, along with Frederick Borden, and completed its IPO in the same year. Headquartered in Mill Valley, California, Redwood Trust is internally managed and structured as a real estate investment trust (REIT) for federal income tax purposes, committing to distribute at least 90% of its taxable earnings as dividends to shareholders.
Redwood Trust operates through three core segments: Residential Mortgage Banking, Business Purpose Mortgage Banking, and an Investment Portfolio. The Residential Mortgage Banking segment acquires residential mortgage loans from third-party originators, which are then sold, securitized, or retained in its investment portfolio. It also uses derivative instruments to mitigate risks. The Business Purpose Mortgage Banking segment generates and procures business-purpose loans, such as single-family rental and bridge loans, which are subsequently securitized or sold. The Investment Portfolio segment allocates capital to a diverse range of assets, including securities from its own securitizations, residential and small multifamily bridge loans, mortgage-backed securities from other entities, Freddie Mac K-Series multifamily loan products, reperforming loan securitizations, servicer advance investments, home equity products, and other housing-related ventures.
As of recent data, Redwood Trust has approximately 351 full-time employees. The company’s financial metrics indicate a market cap of about $3.14 billion, with a beta of 0.0856, reflecting low volatility relative to the market. The company pays a dividend, with a last dividend of $2.2812 per share and a dividend yield of 15.2% (TTM). Revenue per share is $7.88, and the price-to-book ratio is 0.635. The company has a high debt-to-equity ratio of 29.414, typical for financial institutions.
Christopher J. Abate, who has served as CEO since May 2018 and as a director since December 2017, leads the company. He has been employed with Redwood Trust for several years and oversees a robust mortgage banking volume exceeding $8 billion. Redwood Trust is committed to providing liquidity to growing housing markets, with a focus on innovation and risk management.
The company’s senior notes, such as the 9.125% Senior Notes due 2029 (ticker RWTN), are part of its capital-raising activities to support its investment and lending operations. These notes are publicly traded on the New York Stock Exchange. With a strong presence in housing credit, Redwood Trust continues to play a vital role in the U.S. housing finance system.
YoYYoY means Year-over-Year. It compares the latest annual value with the previous annual value to show long-term trend strength.
QoQQoQ means Quarter-over-Quarter. It compares the latest quarter with the immediately previous quarter to show short-term momentum changes.
RevenueThe total money that came through the front door from selling things, before paying a single bill. Think of it as the grand total of every credit card swipe from customers. (YoY compares this year to last year's performance, while QoQ compares the current three months to the previous three).
$274.8M
+13.3%
+369.6%
Net IncomeThe absolute bottom line. If the company paid every single supplier, employee, banker, and tax collector, this is the actual money left in their pocket at the end of the day.
$-70.0M
-229.7%
+80.0%
Gross MarginThe basic markup. If they sell a $100 pair of sneakers, this percentage tells you how much of that price tag is profit right after paying for the rubber and shoelaces, but before paying for things like store rent or TV commercials.
+89.7%
-10.3%
+7.9%
Operating MarginThe 'day job' efficiency score. Out of every dollar a customer spends, this shows how many cents the company keeps after making the product AND paying for all the everyday corporate overhead (like salaries, marketing, and keeping the lights on).
-9.7%
-121.8%
+5885.5%
Net MarginThe final take-home percentage. When you strip away every conceivable cost, tax, and interest payment, this is the exact number of cents the company truly gets to keep from every dollar in sales.
-25.5%
-214.5%
+95.7%
Free Cash FlowThe holy grail of corporate cash. It's the spendable, physical money left over after the business pays for its daily operations AND buys the big, expensive upgrades (like new factories or servers) it needs to survive. This is the 'free' money they can use to pay dividends or buy back stock.
$-10.1B
-72.2%
+16.9%
FCF MarginThe ultimate cash conversion rate. It shows how good the company is at turning regular sales directly into cold, hard, spendable cash. A high percentage means the business is an absolute cash-printing machine.
-3673.7%
-52.0%
+82.3%
Debt / EquityThe financial risk gauge. It compares how much of the company's empire was built using borrowed money (loans) versus the owners' own money (shareholders). A high number means they are heavily leveraged and playing a riskier game; a low number means they are playing it safe.
2267.7%
+60.8%
+11.7%
Current RatioThe 12-month survival check. It simply compares the cash they have right now (plus things they can quickly turn into cash) against the immediate bills they absolutely must pay this year. A score above 1 means they have enough in the wallet to cover the upcoming bills without panicking.
0.08x
-77.1%
-290054.6%
Total AssetsThe absolute size of the company's empire. It bundles together absolutely everything of value they own—from the cash in the register and the inventory in the warehouse, to the software patents in the vault and the factories on the ground.
Operator: Greetings, and welcome to the Redwood Trust, Inc. Second Quarter 2026 Financial Results Conference Call. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Natasha Fatheree, FP&A Leader. Thank you. You may begin. Unknown Executive Thank you, operator. Hello, everyone, and thank you for joining us today for Redwood's second quarter 2026 earnings conference call. With me on today's call are Chris Abate, Chief Executive Officer; Dash Robinson, President; Brooke Carillo, Chief Financial Officer; and Abhinav Asthana, our Chief Technology Officer. Before we begin today, I want to remind you that certain statements made during management's presentation today with respect to future financial and business performance may constitute forward-looking statements. Forward-looking statements are based on current expectations, forecasts and assumptions, which include risks and uncertainties that could cause actual results to differ materially. We encourage you to read the company's annual report on Form 10-K and quarterly report on Form 10-Q, which provides a description of some of the factors that could have a material impact on the company's performance and cause actual results to differ from those that may be expressed in forward-looking statements. On this call, we may also refer to both GAAP and non-GAAP financial measures. The non-GAAP financial measures provided should not be utilized in isolation or considered as a substitute for measures of financial performance prepared in accordance with GAAP. Reconciliations between GAAP and non-GAAP financial measures are provided in our second quarter Redwood review, which is available on our website, redwoodtrust.com. Also note that the contents of today's conference call contains time-sensitive information that are accurate only as of today. We do not intend and undertake no obligation to update this information to reflect subsequent events or circumstances. Finally, today's call is being recorded. It will be available on our website later today. With that, I'll turn the call over to Chris for opening remarks.
Christopher Abate: Thank you, and good morning, everyone. Redwood exceeded $8 billion of mortgage banking volume for the second straight quarter. We did over 20 securitizations in the first half of the year. We ended the quarter pricing 3 securitizations in a single week, one for each of our operating platforms, the first for Redwood in our 32-year history. That makes us happy and a little nostalgic how productive the company operates these days relative to the past when 2 to 4 securitizations a year was deemed just fine by market standards. Broadly speaking, it's no secret the housing finance business has been a lot less forgiving for this current generation of mortgage practitioners, first in over 40 years not to benefit from a long-term bull market in interest rates, which served as an invisible tailwind for both the lucky and the smart. Home …