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New Residential Investment (NRZ) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

In the latest trading session, New Residential Investment (NRZ) closed at $15.68, marking a +0.58% move from the previous day. This change outpaced the S&P 500's 0.51% gain on the day. Elsewhere, the Dow gained 0.36%, while the tech-heavy Nasdaq added 0.75%.

Prior to today's trading, shares of the real estate investment trust had gained 10.88% over the past month. This has outpaced the Finance sector's gain of 5.33% and the S&P 500's gain of 3.44% in that time.

Investors will be hoping for strength from NRZ as it approaches its next earnings release. The company is expected to report EPS of $0.54, down 14.29% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $236.92 million, down 9.82% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.15 per share and revenue of $912.94 million. These totals would mark changes of -9.66% and -13.69%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for NRZ. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. NRZ is holding a Zacks Rank of #3 (Hold) right now.

Digging into valuation, NRZ currently has a Forward P/E ratio of 7.25. Its industry sports an average Forward P/E of 10, so we one might conclude that NRZ is trading at a discount comparatively.

The REIT and Equity Trust industry is part of the Finance sector. This group has a Zacks Industry Rank of 147, putting it in the bottom 43% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow NRZ in the coming trading sessions, be sure to utilize Zacks.com.


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