Rithm Capital Q3 Beat Leaves 35% Gap to Analyst Targets
Rithm Capital beat Q3 estimates by 10%, extending a four-quarter beat streak with 39.4% TTM revenue growth. Yet the stock trades 35% below the mean analyst target of $12.48, suggesting the market is a
Rithm Capital Q3 Beat Leaves 35% Gap to Analyst Targets
NEW YORK, October 28 —
Rithm Capital Corp. (RITM) has beaten analyst EPS estimates in each of the last four consecutive quarters, by as much as 27.5%, yet the stock trades at $9.39, a 4.0x forward P/E and roughly 35% below the mean Wall Street target of $12.48. Four straight beats against 39.4% trailing revenue growth is the record of a company the market is actively choosing not to re-rate.
- Q3 2026 EPS of $0.55 beat consensus by 10.0%, per the October 23 8-K.
- TTM revenue of $4.69 billion grew 39.4% year-over-year; stock trades at 4.0x forward P/E.
- Eleven analysts carry a mean price target of $12.48, a $3.09 premium to the current price; Keefe, Bruyette & Woods targets $13.00.
The Beat Streak That Keeps Getting Ignored
Rithm, formerly New Residential Investment Corp., rebranded in 2022 to signal its pivot toward asset management, originates and services GSE and non-GSE mortgage loans, extends residential transitional lending, and manages a portfolio spanning mortgage servicing rights, single-family rentals, CLOs, and consumer loans. The earnings progression tells a coherent story: Q4 2025 posted a 27.5% beat, Q1 2026 a modest 2.0%, Q2 2026 a 20.1% beat, and Q3 2026 a 10.0% beat. Each quarter the company clears the bar the Street sets. Each quarter the re-rating fails to arrive, leaving the stock within a few percent of where it opened the year.
A Director Sold Above Where the Stock Sits Now
The discount to analyst targets is sharpened by one datapoint from inside the company. Director Peggy Hwan Hebard sold 14,520 shares at $10.18 on August 20, 2026, per Form 4 filings, a price the stock has not recovered to since. Insider ownership stands at just 0.5% of shares outstanding, so the transaction is notable less for its size than for its price: the director extracted value at a level the market has not revisited. Whether that reflects personal liquidity needs or a view on the stock's near-term ceiling is unknowable, but the gap between the $10.18 sale price and today's $9.39 sits inside the larger gap between where the stock trades and where eleven analysts think it belongs.
| Ticker | Mkt cap | Fwd P/E | 52-wk |
|---|---|---|---|
| RITM | $5.2B | 4.0x | -14.1% |
| ABR | $584M | 6.5x | -75.0% |
| STWD | $4.7B | 6.7x | -31.9% |
| OBDC | $5.0B | 7.8x | -22.2% |
| HTGC | $3.1B | 8.4x | -6.6% |
| RC | $194M | n/a | -61.6% |
What Would Prove the Discount Wrong
The market's hesitation likely reflects Rithm's REIT structure and mortgage-heavy heritage, $37.65 billion in total debt against $2.45 billion in cash is standard for a firm financing MSRs and an origination platform, but it reads as balance-sheet risk to generalist investors. The 89.1% gross margin and the asset-management pivot tell a different story. The key number to watch next quarter is whether EPS holds above $0.50, sustaining the beat pattern as rate-sensitive origination volumes adjust. A fifth consecutive beat, particularly if revenue growth continues near its trailing rate, would either force a reassessment of the mortgage-REIT discount or surface a real question about earnings quality. Run the free Rithm Capital Corp. deep-dive →
Current fundamentals, valuation and filing history for Rithm Capital Corp. (RITM) are tracked on its Basis Report page.
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Frequently Asked Questions
Why does Rithm trade below analyst targets?
Rithm beat Q3 estimates by 10% for the fourth consecutive quarter with 39.4% TTM revenue growth, yet trades at $9.39, roughly 35% below the mean analyst target of $12.48. The market's hesitation likely reflects Rithm's REIT structure and mortgage-heavy heritage, though the company's 89.1% gross margin and asset-management pivot suggest a different earnings profile.
How much did Rithm beat Q3 earnings?
Rithm Capital beat Q3 consensus EPS by 10.0%, with earnings of $0.55 per share. This is the fourth consecutive quarterly beat, extending a streak that includes a 27.5% beat in Q4 2025, a 2.0% beat in Q1 2026, and a 20.1% beat in Q2 2026.
What is Rithm's analyst price target?
Eleven analysts carry a mean price target of $12.48 for Rithm, representing a $3.09 premium to the stock's current price of $9.39. Keefe, Bruyette & Woods targets $13.00.
What does Rithm Capital do?
Rithm originates and services GSE and non-GSE mortgage loans, extends residential transitional lending, and manages mortgage servicing rights, single-family rentals, CLOs, and consumer loans. The company rebranded from New Residential Investment Corp. in 2022 to signal its pivot toward asset management.
Did Rithm insiders sell stock recently?
Director Peggy Hwan Hebard sold 14,520 shares at $10.18 on August 20, 2026, a price the stock has not recovered to since. Insider ownership stands at just 0.5% of shares outstanding.
Rithm Capital filed Q3 2026 earnings on October 23, extending a streak of analyst estimate beats to at least four consecutive quarters. The stock trades at $9.39 — a 4.0x forward P/E and roughly 35% below the Wall Street consensus target — raising a question its own results keep sharpening: why does a consistent earnings outperformer trade like a distressed mortgage REIT?