What Are the Fundamentals Of RC?

Now trading at a price of $11.18, Ready Capital has rose 2.48% Friday.

Ready Capital shares moved -16.49% over the last 52 weeks, with a high of $13.89 and a low of $9.35. During this time, the stock lagged the S&P 500 index by -12.79%. As of January 2022, the company's 50-day average price is $12.32. Ready Capital Corporation, is a real estate finance company in the United States. The small-cap Real Estate company is based in New York, NY. Ready Capital has returned a 14.5% dividend yield over the last 12 months.

An Unconvincing Cash Flow History with an Upwards Trend:

2019-12-31 2020-12-31 2021-12-31 2022-12-31
Revenue (k) $282,811 $419,912 $577,281 $567,936
Revenue Growth n/a 48.48% 37.48% -1.62%
Gross Margins 29.6% 7.86% 40.1% 41.66%
Gross Margins Growth n/a -73.45% 410.18% 3.89%
Operating Margins -2.89% -26.08% 11.93% 9.22%
Operating Margins Growth n/a -802.42% 145.74% -22.72%
Earnings Per Share $1.43 $0.83 $2.08 $1.76
EPS Growth n/a -41.96% 150.6% -15.38%
Diluted Shares (MM) 51 54 76 111
Free Cash Flow (k) -$52,514 $68,564 -$34,441 $348,176
FCF Growth n/a 230.56% -150.23% 1110.93%
Capital Expenditures (k) $117 $329 n/a $10,972
LT Debt to Equity 0.53 0.54 0.7 0.63

Ready Capital Is Currently Undervalued:

Compared to the Real Estate sector's average of 24.81, Ready Capital has a trailing twelve month P/E ratio of 6.73 and, according to its EPS guidance of 1.66, an expected P/E ratio of 6.73.

In addition, Ready Capital is likely undervalued in terms of its equity because its P/B ratio is 0.809 compared to its sector average of 2.24. The company's shares are currently trading -52.06% below their Graham number, implying there is a margin of safety for the stock. The Graham number is calculated according to the formula:

√(22.5 * 5-year average EPS * book value per share) = √(22.5 * 1.59 * 15.2) = $23.32

8 analysts are following Ready Capital and have set target prices ranging from $11.5 to $16.0 per share. On average, they have given the company a rating of buy. At the current price of $11.18, RC is trading -19.45% away from its average analyst target price of $13.88 per share, implying an analyst consensus of some upside potential for the stock.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.