New Residential Investment To Buy Back $200M In Stock
New Residential Investment Corp. announced a new stock repurchase program of up to $200 million, replacing the previous $200 million stock buyback plan, which expired on Dec. 31, 2020. Shares of the real estate investment trust closed about 3.5% higher on Tuesday.
New Residential (NRZ), under its new repurchase program, will continue to buy back its common shares through Dec. 31, 2021.
Besides share repurchases, the company consistently boosts its shareholders’ returns through regular dividend payments and hikes. On Dec. 16, New Residential raised its quarterly dividend by 33.3% to $0.20 per share. Its annual dividend of $0.80 per share translates into a dividend yield of 7.9%.
Meanwhile, on Feb. 9, New Residential Investment reported lukewarm 4Q results. The company’s core earnings of $0.32 were in-line with analysts’ estimates. However, revenues of $570.7 million missed the Street’s estimates of $768.8 million. (See New Residential stock analysis on TipRanks)
Post 4Q results, Raymond James analyst Stephen Laws raised the stock’s price target to $12.50 (28% upside potential) from $11.50 and maintained a Buy rating based on “the strong origination volume and higher servicing income as refinance activity slows.”
Meanwhile, the Street has a bullish outlook on the stock, with a Strong Buy consensus rating based on 8 unanimous Buys. The average analyst price target of $11.06 implies an upside potential of about 9.7% to current levels. Shares declined about 39.2% in one year.
Furthermore, TipRanks data shows that financial blogger opinions are 87% Bullish, compared to a sector average of 71%.