Thrifts & Mortgage Finance Stocks Q2 Teardown: Starwood Property Trust (NYSE:STWD) Vs The Rest

August 18, 2025 at 23:31 PM EDT

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Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at Starwood Property Trust (NYSE: STWD) and the best and worst performers in the thrifts & mortgage finance industry.

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 18 thrifts & mortgage finance stocks we track reported a slower Q2. As a group, revenues missed analysts’ consensus estimates by 29.8% while next quarter’s revenue guidance was in line.

In light of this news, share prices of the companies have held steady as they are up 3.4% on average since the latest earnings results.

Starwood Property Trust (NYSE: STWD)

With a diverse portfolio spanning commercial properties, residential mortgages, infrastructure loans, and real estate servicing, Starwood Property Trust (NYSE: STWD) is a real estate investment trust that originates, acquires, and manages commercial mortgages, residential loans, and other real estate investments.

Starwood Property Trust reported revenues of $165.5 million, down 11.2% year on year. This print fell short of analysts’ expectations by 20.4%. Overall, it was a softer quarter for the company with a significant miss of analysts’ net interest income estimates.

"We have continued to demonstrate the strength and flexibility of our multi-cylinder platform," said Barry Sternlicht, Chairman and CEO of Starwood Property Trust.

Interestingly, the stock is up 2.5% since reporting and currently trades at $19.91.

Read our full report on Starwood Property Trust here, it’s free.

Best Q2: Ellington Financial (NYSE: EFC)

Operating under the guidance of Ellington Management Group, a respected name in structured credit markets, Ellington Financial (NYSE: EFC) acquires and manages a diverse portfolio of mortgage-related, consumer-related, and other financial assets to generate returns for investors.

Ellington Financial reported revenues of $92.54 million, up 1.5% year on year, outperforming analysts’ expectations by 11.5%. The business had a stunning quarter with a solid beat of analysts’ tangible book value per share estimates and a beat of analysts’ EPS estimates.

The market seems happy with the results as the stock is up 8.8% since reporting. It currently trades at $13.78.

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

Weakest Q2: Franklin BSP Realty Trust (NYSE: FBRT)

Operating as a specialized real estate investment trust (REIT) with roots dating back to 2012, Franklin BSP Realty Trust (NYSE: FBRT) originates and manages a diversified portfolio of commercial real estate debt investments secured by properties in the United States and abroad.

Franklin BSP Realty Trust reported revenues of $50.78 million, up 171% year on year, falling short of analysts’ expectations by 8.9%. It was a disappointing quarter as it posted a significant miss of analysts’ net interest income estimates and a significant miss of analysts’ EPS estimates.

Interestingly, the stock is up 11.4% since the results and currently trades at $11.24.

Read our full analysis of Franklin BSP Realty Trust’s results here.

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 $150.4 million, up 53.5% year on year. This number surpassed analysts’ expectations by 1.6%. Zooming out, it was a satisfactory quarter as it also produced a narrow beat of analysts’ net interest income estimates but tangible book value per share in line with analysts’ estimates.

The stock is down 3.1% since reporting and currently trades at $11.96.

Read our full, actionable report on Northwest Bancshares here, it’s free.

AGNC Investment (NASDAQ: AGNC)

Born during the 2008 financial crisis when mortgage markets were in turmoil, AGNC Investment (NASDAQ: AGNC) is a real estate investment trust that primarily invests in mortgage-backed securities guaranteed by U.S. government agencies or enterprises.

AGNC Investment reported revenues of -$112 million, down 367% year on year. This print came in 141% below analysts' expectations. It was a disappointing quarter as it also recorded a significant miss of analysts’ net interest income estimates and a significant miss of analysts’ EPS estimates.

AGNC Investment had the slowest revenue growth among its peers. The stock is up 4.1% since reporting and currently trades at $9.61.

Read our full, actionable report on AGNC Investment 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 Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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