Global asset manager Rithm Capital Corp. RITM is set to report fourth-quarter 2024 results on Feb. 6, 2025, before the opening bell. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is currently pegged at 45 cents per share on revenues of $1.23 billion. 

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The fourth-quarter earnings estimate has remained stable over the past 60 days. However, the bottom-line projection indicates a year-over-year decline of 11.8%. Meanwhile, the Zacks Consensus Estimate for quarterly revenues suggests a year-over-year jump of 73.2%.

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For 2024, the Zacks Consensus Estimate for Rithm Capital’s revenues is pegged at $4.34 billion, implying a rise of 20% year over year. However, the consensus mark for current year EPS is pegged at $1.95, implying a fall of around 5.3% on a year-over-year basis.

Rithm Capital beat the consensus estimate in each of the last four quarters, with the average surprise being 25.1%.

Q4 Earnings Whispers for Rithm Capital

Our proven model predicts a likely earnings beat for the company this time around as well. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That’s precisely the case here.

RITM has an Earnings ESP of +2.22% and a Zacks Rank #1. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

You can see the complete list of today’s Zacks #1 Rank stocks here.

What’s Shaping Rithm Capital’s Q4 Results?

Higher fees, interest income and multiple acquisitions are expected to have supported its revenue growth. It is expected to have generated enhanced returns from specific investments and consumer loans. The Zacks Consensus Estimate for fourth-quarter interest income indicates 13.6% year-over-year growth. Also, the consensus mark for net servicing revenues is pegged at $390.4 million, signaling a massive year-over-year jump.

The growing profitability of its Newrez business is likely to have aided its Origination & Servicing segment. Also, the Zacks Consensus Estimate for fourth-quarter net gain on originated residential mortgage loans indicates a 77.3% year-over-year jump.

The consensus mark for asset management revenues is pegged at $101.2 million, sequentially up from $81 million. The above-mentioned factors are expected to have positioned the company for year-over-year growth in revenues.

However, increased interest expense and warehouse line fees in the quarter under review are expected to have partially offset the positives. Higher general and administrative expenses, compensation and benefits are likely to have increased total expenses, slashing profits. Nevertheless, its hedging strategies are likely to have provided some protection from the burden of increasing interest expenses.

Other Stocks That Warrant a Look

Here are some other companies worth considering from the broader finance space, as our model shows that these, too, have the right combination of elements to beat on earnings this time around:

Crescent Capital BDC, Inc. CCAP has an Earnings ESP of +1.18% and is a Zacks #2 Ranked player.

The Zacks Consensus Estimate for Crescent Capital’s bottom line for the to-be-reported quarter is pegged at 56 cents per share, which remained stable over the past month. The consensus estimate for CCAP’s revenues is pegged at $47.01 million.

Angel Oak Mortgage REIT, Inc. AOMR has an Earnings ESP of +1.35% and a Zacks Rank of 3.

The Zacks Consensus Estimate for Angel Oak’s bottom line for the to-be-reported quarter indicates a 196.2% improvement from a year ago. The consensus mark for AOMR’s revenues signals 22.2% growth year over year.

American Homes 4 Rent AMH has an Earnings ESP of +1.84% and a Zacks Rank of 3.

The Zacks Consensus Estimate for American Homes’ bottom line for the to-be-reported quarter is pegged at 45 cents per share, indicating a 4.7% increase from the year-ago period. AMH beat earnings estimates in three of the past four quarters and met once, with an average surprise of 2.3%.

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American Homes 4 Rent (AMH) : Free Stock Analysis Report

Crescent Capital BDC, Inc. (CCAP) : Free Stock Analysis Report

Angel Oak Mortgage REIT Inc. (AOMR) : Free Stock Analysis Report

Rithm Capital Corp. (RITM) : Free Stock Analysis Report

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