Thrifts & Mortgage Finance Stocks Q1 Teardown: Ready Capital (NYSE:RC) Vs The Rest

June 29, 2025 at 23:36 PM EDT

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Let’s dig into the relative performance of Ready Capital (NYSE: RC) and its peers as we unravel the now-completed Q1 thrifts & mortgage finance earnings season.

Thrifts & Mortgage Finance institutions operate by accepting deposits and extending loans primarily for residential mortgages, earning revenue through interest rate spreads (difference between lending rates and borrowing costs) and origination fees. The industry benefits from demographic tailwinds as millennials enter prime homebuying age, technological advancements streamlining the loan approval process, and potential interest rate stabilization improving affordability. However, significant headwinds include net interest margin compression during rate volatility, increased competition from fintech disruptors offering digital-first experiences, mounting regulatory compliance costs, and potential housing market corrections that could impact loan portfolios and default rates.

The 22 thrifts & mortgage finance stocks we track reported a slower Q1. As a group, revenues missed analysts’ consensus estimates by 18.5%.

In light of this news, share prices of the companies have held steady as they are up 1.8% on average since the latest earnings results.

Ready Capital (NYSE: RC)

Operating as one of only 17 non-bank Small Business Lending Companies with preferred lender status from the SBA, Ready Capital (NYSE: RC) is a multi-strategy real estate finance company that originates, acquires, and services commercial real estate loans, small business loans, and other real estate investments.

Ready Capital reported revenues of $31.32 million, up 140% year on year. This print fell short of analysts’ expectations by 56.7%. Overall, it was a disappointing quarter for the company with a significant miss of analysts’ tangible book value per share and EPS estimates.

“Market volatility, tariff implementations, declining consumer confidence and increased recession expectations provide headwinds for our business”, said Thomas Capasse, Ready Capital’s Chairman and Chief Executive Officer.

Interestingly, the stock is up 3.6% since reporting and currently trades at $4.52.

Read our full report on Ready Capital here, it’s free.

Best Q1: Northwest Bancshares (NASDAQ: NWBI)

Founded in 1896 and operating across Pennsylvania, New York, Ohio, and Indiana, Northwest Bancshares (NASDAQ: NWBI) is a bank holding company that operates Northwest Bank, providing personal and business banking, investment management, and trust services.

Northwest Bancshares reported revenues of $156.2 million, up 19% year on year, outperforming analysts’ expectations by 9.9%. The business had a stunning quarter with a solid beat of analysts’ EPS and net interest income estimates.

The market seems happy with the results as the stock is up 8.6% since reporting. It currently trades at $12.83.

Is now the time to buy Northwest Bancshares? Access our full analysis of the earnings results here, it’s free.

Dynex Capital (NYSE: DX)

Operating in the financial markets since 1988 with a focus on capital preservation during economic turbulence, Dynex Capital (NYSE: DX) is a mortgage real estate investment trust that invests primarily in government-backed residential mortgage securities to generate income for shareholders.

Dynex Capital reported revenues of $17.13 million, up 637% year on year, falling short of analysts’ expectations by 22.4%. It was a disappointing quarter as it posted a significant miss of analysts’ EPS estimates.

As expected, the stock is down 2.6% since the results and currently trades at $12.15.

Read our full analysis of Dynex Capital’s results here.

Two Harbors Investment (NYSE: TWO)

Operating in the complex world of mortgage finance since 2009, Two Harbors Investment (NYSE: TWO) is a real estate investment trust that invests in mortgage servicing rights and agency residential mortgage-backed securities.

Two Harbors Investment reported revenues of -$28.33 million, down 110% year on year. This number came in 125% below analysts' expectations. Overall, it was a softer quarter as it also recorded a significant miss of analysts’ EPS estimates.

Two Harbors Investment had the weakest performance against analyst estimates and slowest revenue growth among its peers. The stock is down 10.4% since reporting and currently trades at $10.75.

Read our full, actionable report on Two Harbors Investment here, it’s free.

WaFd Bank (NASDAQ: WAFD)

Founded in 1917 and rebranded from Washington Federal in 2023, WaFd (NASDAQ: WAFD) is a bank holding company that provides lending, deposit services, and insurance through its Washington Federal Bank subsidiary across eight western states.

WaFd Bank reported revenues of $179.8 million, up 3.4% year on year. This print beat analysts’ expectations by 3.6%. It was a very strong quarter as it also logged a decent beat of analysts’ net interest income estimates and a decent beat of analysts’ EPS estimates.

The stock is down 2.1% since reporting and currently trades at $29.32.

Read our full, actionable report on WaFd Bank here, it’s free.

Market Update

Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.

Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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