Barclays lowered the firm’s price target on PennyMac Financial (PFSI) to $116 from $136 and keeps an Overweight rating on the shares. The firm adjusted mortgage finance targets as part of a Q1 earnings preview, saying higher rates have reset valuations lower. Despite a 40 basis point increase off the February trough for the 30-year fixed-rate mortgage, it is only modestly higher than at the start of the year, the analyst tells investors in a research note. Barclays sees positive risk/rewards at current valuations for the mortgage origination-levered stocks.
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