PennyMac Financial Services, Inc. (PFSI) vs Walker & Dunlop, Inc. (WD)

PennyMac Financial Services, Inc. and Walker & Dunlop, Inc. are both Mortgage Finance companies. PennyMac Financial Services, Inc. is the larger, with a market value of $3.5B against $1.4B — 2.5× the size. Walker & Dunlop, Inc. has negative trailing earnings, so its P/E is not meaningful; PennyMac Financial Services, Inc. trades at 14.2×. PennyMac Financial Services, Inc. grew revenue faster over the last twelve months: 3.54% against 0.87%. PennyMac Financial Services, Inc. has the higher net margin (11.7% vs −2.68%) and the higher return on invested capital (1.51% vs −0.85%). Both pay a dividend; Walker & Dunlop, Inc. yields more (7.01% vs 1.84%). Across the 19 metrics below, PennyMac Financial Services, Inc. leads on 11 and Walker & Dunlop, Inc. on 8.

Valuation

Metric PFSI WD Mortgage Finance median
P/E 14.16 n/m 10.24
P/S 1.65 1.03 1.52
P/B 0.78 0.77 0.52
Price to free cash flow n/m 0.84 4.71
EV/EBITDA — — —
EV/Sales — — —
Earnings yield 7.06% (2.50%) (2.50%)
Free cash flow yield (9.21%) 118.72% (9.21%)

Profitability

Metric PFSI WD Mortgage Finance median
Gross margin 76.78% 46.45% 81.25%
Operating margin 20.37% 1.91% 1.91%
Net margin 11.69% (2.68%) (1.66%)
Free cash flow margin (15.01%) 123.39% (15.01%)
Return on equity 5.59% (1.94%) (1.94%)
Return on assets 0.87% (0.66%) (0.23%)
Return on invested capital 1.51% (0.85%) 0.00%

Growth

Metric PFSI WD Mortgage Finance median
Revenue growth (TTM) 3.54% 0.87% 7.49%
EPS growth (last fiscal year) 59.25% (48.59%) 20.88%
Revenue growth, 5-year CAGR (11.20%) 2.64% (11.12%)
Net income growth, 5-year CAGR (21.18%) (25.48%) 0.00%

Health

Metric PFSI WD Mortgage Finance median
Debt to equity 3.12 0.94 0.94
Current ratio 0.29 0.00 1.07
Net debt to EBITDA 18.29 4.45 15.25

Dividend

Metric PFSI WD Mortgage Finance median
Dividend yield 1.84% 7.01% 7.01%
Payout ratio 0.27 2.42 —

Size

Metric PFSI WD Mortgage Finance median
Market cap 3.49b 1.37b 269.18m

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