Guild Holdings deal valuation supportive of Onity Group, says BTIG

After Guild Holdings (GHLD) announced this week it has agreed to be acquired by Bayview Asset Management for $20 per share, or $1.3B in cash, BTIG points out that this price represents a 27% premium to Guild’s tangible book value at March 31. The Guild deal valuation near 1.3-times tangible book value and about 10-times forward earnings is “broadly supportive of valuations for non-bank originators and servicers,” especially stocks like Onity (ONIT), which carry competitive operational scale and trade at a material discount to book value, the analyst tells investors. The firm, whose estimates for Guild are under review, sees “few barriers which would disrupt an anticipated deal closing by year-end.” BTIG has Buy ratings on both Guild and Onity shares.