Worth Watching Stock for Traders: Redwood Trust (RWT)

Redwood Trust, Inc. (NYSE: RWT) changed -0.19% to recent value of $16.11. The stock transacted 566074 shares during most recent day however it has an average volume of 714.7K shares. It spotted trading -7.94% off 52-week high price. On the other end, the stock has been noted 12.74% away from the low price over the last 52-weeks.

Redwood Trust, Inc. (NYSE: RWT) reported that it intends to offer 10,000,000 shares of its common stock in an underwritten public offering. Redwood expects to grant the underwriters a 30-day option to purchase up to an additional 1,500,000 shares of its common stock in the offering. All of the shares of common stock will be offered and sold by Redwood. The offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering.

Redwood intends to use the net proceeds from this offering to fund its business and investment activity, which may include funding recently completed investment transactions (including, for example, funding capital calls on a multifamily whole loan investment fund) and funding the initial cash portion of the purchase price for our pending acquisition of 5 Arches, LLC as well as new investment opportunities in bridge loans for single-family and small-balance multifamily properties, mortgage loans for single-family rental properties, residential and multifamily mortgage backed securities, as well as for our mortgage banking business and general corporate purposes. Pending such uses, Redwood may use all or a portion of the net proceeds from this offering to temporarily reduce borrowings under its short-term residential loan warehouse facilities and its short-term real estate securities repurchase facilities.

Wells Fargo Securities, LLC, J.P. Morgan, Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. LLC are acting as joint book-running managers for the proposed offering.

 RWT has a gross margin of 42.40% and an operating margin of 48.10% while its profit margin remained 44.40% for the last 12 months. Its earnings per share (EPS) expected to touch remained -18.20% for this year while earning per share for the next 5-years is expected to reach at 8.00%.

 The company has 82.61M of outstanding shares and 81.48M shares were floated in the market.. The price moved ahead of 2.30% from the mean of 20 days, 0.99% from mean of 50 days SMA and performed -0.80% from mean of 200 days price. Company’s performance for the week was 1.00%, 6.13% for month and YTD performance remained 6.90%.

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