Q2 2024 PennyMac Financial Services Inc Earnings Call Transcript
Key Points
- PennyMac Financial Services Inc (PFSI) reported net income of $98 million, translating to an annualized return on equity (ROE) of 11%.
- The company's Board of Directors approved a quarterly common stock dividend of $0.30 per share, up from $0.20 in the prior quarter, representing a 50% increase.
- PFSI's production segment saw a pretax income increase to $41 million, up from $36 million in the prior quarter, with total acquisition and origination volumes rising by 25%.
- The servicing segment recorded a pretax income of $89 million, with operating expenses at their lowest levels in history at under 6 basis points.
- PFSI's proprietary servicing system has been enhanced to incorporate new technologies, including artificial intelligence, driving operating efficiencies and reducing costs.
- The company experienced $72 million of net fair value declines on MSRs and hedges, impacting overall earnings.
- Correspondent channel margins decreased to 30 basis points from 35 basis points in the prior quarter due to competitive pricing pressures.
- Hedge costs were at the higher end of the expected range, around 2%, due to significant interest rate volatility.
- The servicing segment's fair value declines on hedges exceeded MSR fair value increases, resulting in total hedge declines of $172 million.
- There was a slight uptick in delinquencies in the second quarter, attributed to seasonal factors and fewer business days in June.
Good afternoon, and welcome to PennyMac Financial Services, Inc. second-quarter 2024 earnings call. Additional earning materials, including presentation slides that will be referred to in this call, are available on PennyMac Financial's website at pfsi.pennymac.com.
Before we begin, let me remind you that this call may contain forward-looking statements that are subject to certain risks identified on slide 2 of the earnings presentation that could cause the company's actual results to differ materially as well as non-GAAP measures that have been reconciled to their GAAP equivalent in the earnings materials.
Now I'd like to introduce David Spector, PennyMac Financial's Chairman and Chief Executive Officer; and Dan Perotti, PennyMac's Chief Financial Officer.
Thank you, operator. Good afternoon, and thank you to everyone for participating in our second quarter earnings call. PFSI reported net income of $98 million or an annualized return on equity of
| Access to All Earning Calls and Stock Analysis | |
| 30-Year Financial on one screen | |
| All-in-one Stock Screener with unlimited filters | |
| Customizable Stock Dashboard | |
| Real Time Insider Trading Transactions | |
| 8,000+ Institutional investors’ 13F holdings | |
| Powerful Excel Add-in and Google sheets Add-on | |
| All data downloadable | |
| Quick customer support | |
| And much more... |
Trustpilot
We'd love to learn more about your experiences on GuruFocus.com and how we can improve!
Take Survey
