Deutsche Bank Analyst Boosts Price Target on Mr Cooper Group, Maintains Strong Buy Rating

Deutsche Bank's Mark Devries raised their price target on Mr Cooper Group (NASDAQ: COOP) by 2.3% from $88 to $90 on April 25, 2024. The analyst maintained their Strong Buy rating on the stock.

In an assessment of Mr Cooper Group's first-quarter 2024 earnings report, Devries highlighted the growth in servicing as a key factor that boosted the company's worth. The company reported earnings per share (EPS) of $2.73, surpassing the Zacks Consensus Estimate of $2.11 and showing a significant increase of 295.7% compared to the first quarter of 2023. Additionally, Mr Cooper Group reported revenue of $564 million, exceeding the Zacks Consensus Estimate of $498.1 million and demonstrating a growth rate of 39.6% compared to the same period last year.

Chairman and CEO Jay Bray expressed optimism about the company's performance, stating, "The company has started the year with excellent momentum, including return on tangible common equity rising to 14.5%." He also emphasized the company's strategic emphasis on technology, particularly its investment in artificial intelligence (AI) and the cloud, which positions Mr Cooper Group to provide world-class service to customers, operate as a trusted counterparty, and deliver sustainable investor returns.

President Mike Weinbach highlighted the benefits of the company's balanced business model in the current environment. He mentioned the strong momentum with sub-servicing clients, opportunities to acquire mortgage servicing rights (MSRs), and the nimbleness of the originations team in helping customers save money and access their home equity.

Devries was not the only analyst to update their rating and price target on COOP on April 25. Jay McCanless of Wedbush raised their price target by 17.6% from $85 to $100 and maintained their Buy rating on the stock. Bose George of Keefe, Bruyette & Woods also raised their price target by 7% from $86 to $92, reiterating their Buy rating. Terence Malone of Barclays increased their price target by 10.6% from $85 to $94 and maintained their Strong Buy rating.

It is worth noting that all top-rated analysts currently rate COOP as a Strong Buy or Buy. No analysts consider it a Hold, and there are no recommendations to sell the stock.

Since the release of COOP's latest quarterly report on April 24, 2024, the stock price has experienced a decline of 3.6%. However, when comparing the stock's performance year-over-year, it has shown significant growth of 77.3%. During the same period, COOP has outperformed the S&P 500, which has seen a rise of 24%.

Mark Devries, the Deutsche Bank analyst who raised the price target on COOP, is ranked in the top 19% of Wall Street analysts by WallStreetZen. With an average return of 2.8% and a win rate of 52.2%, Devries specializes in the Real Estate and Financial Services sectors, among others.

Mr Cooper Group Inc., formerly known as WMIH Corp., provides servicing, origination, and transaction-based services related to single-family residences in the United States. The company operates through two segments: Servicing and Originations. The Servicing segment handles activities such as collecting and disbursing borrower payments, investor reporting, customer service, and loan modifications. The Originations segment originates residential mortgage loans through its direct-to-consumer channel and also acquires loans from mortgage bankers and brokers. Mr Cooper Group Inc. operates primarily under the Mr. Cooper and Xome brands. The company, incorporated in 2015 and based in Coppell, Texas, has positioned itself as a prominent player in the real estate and financial services industries.

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