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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Rithm Capital Corp. (XNYS:RITM) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
NRZ
Name:
RITHM CAPITAL CORP. (XNYS:RITM)
Sector:
-
Industry:
REIT�Mortgage
CEO:
Mr. Michael Nierenberg
Total Employees:
9,862
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -116.01% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF RITHM CAPITAL CORP.(RITM) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND REIT�MORTGAGE INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
9.26
One Month Price Target:
$9.35
Six Month Price Target :
$9.79
Likely Price in One Year's Time:
Ticker:
$10.31
Likely Trading Range Today Under (Normal Volatility)
$9.19
Price Upper limit ($) :
$9.33
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$8.45
This week:
$7.44
This month :
$5.62
Other Primary facts
Market Cap:
4.25B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
466.86M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
39.88%
-41.83%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$13.04
$11.32
$5.48
$7.20
Medium risk (<10%) entry points
Buy Call
Sell Call
$10.76
Buy Put:
Sell Put:
$10.39
$7.76
$8.13
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
NRZ
Sharpe Ratio:
0.24%
Comparison:
NRZ, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is -147.47% lower than the industry
& is -89.36% lower than the market/S&P 500 average
Average Returns/Yield of
NRZ
Daily returns:
0.02%
Weekly returns:
0.10%
Monthly returns:
0.39%
Yearly returns:
-0.12%
Comparison of returns:
Average annual returns/yield (last 3 years) is -4018.97% below industry average
Classification:
NRZ, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.8
Statistical test of Returns:
NRZ has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
4.29%
Weekly Volatility:
9.59%
Monthly Volatility:
19.19%
Yearly Volatility:
66.47%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.91%
Volatility in last five trading days has been -55.55% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-8.79%
Weekly VaR:
-19.66%
Monthly VaR:
-39.32%
How Much Can the price of
NRZ
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-35%
Worst case (decline):
>85%
This translates to price declining to:
$6.06
This translates to price declining to:
$1.39
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
NRZ is a 177.53% riskier investment compared to the market/S&P 500 & is 137.76% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 41.29% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
NRZ
Beta in relation to market/S&P 500--1.69
Expected beta in 1 year's time:
0.981
Expected beta in 3 year's time:
1.387
Unlevered (debt free) Beta:
6.44
Beta in relation to Nasdaq (XNAS):
0.907
Beta in relation to all global stocks::
0.898
Beta Comparison & Analysis
Beta of competitors/peers::
1.142
Beta is 48.38% higher than peers
Average Industry Beta:
1.365
Beta is 24.17% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
5.76%
Sustainable growth rate is -32.78% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.101
Alpha is -19.66% below industry average alpha yield
Alpha is -645% below the market average
Analysis of Cost of Capital of
NRZ
Equity cost of capital:
0.148
Equity cost of capital is 18.08% above industry mean WACC
Unlevered (without debt) cost of capital:
56.09%
Before-tax cost of debt:
-
After-tax cost of debt:
-
Overall debt rating:
-
Weighted average cost of capital (WACC):
-
-
Key Per-Share Metrics & Analysis
Revenue per share:
$4.36
Revenue growth rate per share of (3Y):
0.61
Annual revenue growth rate is -26.39% below industry average
EPS:
$2.20
Expected Annual growth rate of EPS (3Y):
3.80%
Expected future EPS growth rate is -13360.97% lower than the REIT�Mortgage industry
Free cash flow (FCF) per share:
$7.03
Balance sheet equity growth per share: -51.54%
Equity growth rate per share is 154.03% higher than the industry
Debt per share
$0.00
EBITDA per share
$1,419.78
Valuation Analysis Today of
NRZ
P/E Ratio:
4.65
P/E Ratio of Competitors/Peers:
62.76
P/E ratio is -92.60% lower than main peers & is -49.85% lower than the industry
Stock price/value with industry average P/E ratio: $20.39
NRZ is -54.58% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $199.90
Present value of the expected future dividends only: $38.20
P/S (Price to Sales ratio):
2.12
Price to sales ratio is -61.02% below the industry mean
P/B (Price to book value ratio):
0.61
Price to free cash flow: 1.32
-
Net income growth rate (3Y):
-41.41%
Net income growth rate is -105.23% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 0.02%
Dividend yeild: 10.80%
Previous Dividend: $0.25
Previous adjusted dividend: $0.25
Previous Dividend: $1.00
Expected next dividend best case: $0.35
Expected next dividend worst case: $0.15
Average dividend payment (long-term): $0.22
Average dividend increase/decrease (growth rate) % per period: 11.83%
Expected next dividend payment date: 27/10/2022
Expected next dividend record date: 29/09/2022
Expected next dividend declaration date: 19/09/2022
Previous dividend payment date: 29/07/2022
Previous dividend record date: 07/01/2022
Previous dividend declaration date: 21/06/2022
Dividend History:
2022-06-30--$0.25
2021-12-30--$0.25
2021-07-01--$0.20
2022-04-01--$0.25
2021-10-01--$0.25
2021-04-01--$0.20
Dividend growth rate is -381.42% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
-73.69%
Net debt to equity ratio:
-23.46%
Debt to assets ratio:
-280.16%
Net debt to assets ratio:
-16.67%
Debt-to-asset ratio is -3734.79% below industry average
Ability to repay debt:
Interest coverage ratio:
1546.13
Interest coverage ratio is 1515868.88% more than industry average
Looking forward:
Debt growth rate:
13.55%
Annual debt growth is -1888% lower than industry average debt growth rate
Debt repayment rate in last quarter: 100.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.474
Statistical significance of correlation:
NRZ has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.543
Stock price is -12.77% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.543
Correlation of price movement with Nasdaq (^IXIC):
0.047
Covariance of price movement with the market:
0.118
Kurtosis
30.512
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
-0.154
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
NRZ
Gross Profit Margin Ratio:
147%
Operating Profit Margin Ratio:
-13.13%
Operating profit margin is -118.59% lower than the industry
Net Profit Margin Ratio:
147%
Effective Tax Rate:
0.01%
Effective tax rate is -99.83% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
9299.11%
Return on equity (ROE) is 76179.26% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
6605.97%
Return on assets (ROA) is 60495.38% higher than the industry
Financial Leverage:
0.3x
Current Ratio:
0.2
Current ratio is -99.89% below industry average
Cash Conversion Cycle (days):
0
-
The remaining useful life of property plant & equipment is: 17.5 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
206.6K
Each employee generates -84% less revenue than industry average revenue per employee
EBITDA generated per employee:
67.2M
Each employee generates 269% more EBITDA than industry average revenue per employee
Profit generated per employee:
67.2M
Each employee generates 298% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
0.0K
-
Assets/Capital per employee
40.8K
-
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
NRZ
RYMAN HOSPITALITY PROPERTIES, INC. (XNYS:RHP)
AGREE REALTY CORPORATION (XNYS:ADC)
PS BUSINESS PARKS, INC. (XNYS:PSB)
BLACKSTONE MORTGAGE TRUST, INC. (XNYS:BXMT)
INDEPENDENCE REALTY TRUST, INC (XNYS:IRT)
HIGHWOODS PROPERTIES, INC. (XNYS:HIW)
CUSHMAN & WAKEFIELD PLC (XNYS:CWK)
INNOVATIVE INDUSTRIAL PROPERTIES, INC. (XNYS:IIPR)
SL GREEN REALTY CORP. (XNYS:SLG)
Current Analyst Ratings
Strong buy�8%
Buy�21%
Hold�4%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
2.04B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
443.66M
502.52M
-
1.12B
1.12B
-
- 197538.00K
289.86M
744.22M
428.71M
5.70M
662.84B
- 267552.00K
662.34B
662.43B
59.97M
662.34B
Statement of Cash Flow
Date:
Period:
-
Differed Income Tax :
-
Stock Based Compensation :
-
Change in Working Capital :
-
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
-
Net Cash Provided by Operating Activities:
-
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
1.67B
390.77M
2.06B
7.96B
-
-
10.03B
-
11.84M
-
390.77M
-
-
402.61M
-
10.03B
-
-
-
-
-
-
-
-
-
2.90B
2.90B
4.67M
- 267878.00K
67.2M
7.32B
March 31, 2022 at 6:00:00 AM
731.75M
7.12B
10.03B
781.54M
-
- 1671177.0K
-
-
-
- 33378329.00K
-
-
- 116690.00K
30.78B
- 2716060.00K
-
437.77M
1.97B
1.53B
-
-
-
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
NRZ
2023
2024
2025
2026
2027
$10.36
$50.04
$55.74
$62.09
$69.16