Onity Group (ONIT) AI Stock Analysis

• Market Cap: $341.38M
• Dividend Yield: N/A
• Average Volume (3M): 49.69K
• Price to Earnings (P/E): 10.7
• Beta (1Y): 1.30
• Revenue Growth: -2.84%
• EPS Growth: 2420.57%
• Country: US
• Employees: 4,200
• Sector: Financial
• Sector Strength: 72
• Industry: Financial - Mortgages
• EPS (TTM): 2.40
• Shares Outstanding: 8,055,222
• 10 Day Avg. Volume: 44,949
• 30 Day Avg. Volume: 49,692
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 45.24
• Enterprise Value/Revenue: 14.06
• Enterprise Value/Gross Profit: 29.94
• Enterprise Value/Ebitda: 64.75
• 1Y Price Target: $50.67
• Price Target Upside: 20.04% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 64 Neutral
• Price Target: $42.00 ▼(-0.50% Downside)

Onity Group's overall stock score is driven by its strong earnings call performance, indicating robust net income and book value growth. Technical analysis supports a positive trend, but financial performance is hindered by high leverage and cash flow challenges. Valuation is reasonable, but the lack of a dividend yield is a drawback.

Onity Group Business Overview & Revenue Model

Company Description

Onity Group Inc., a financial services company, originates and services forward and reserve mortgage loans in the United States, the United States Virgin Islands, India, and the Philippines. It operates through the Servicing and Originations segments. The company offers owned mortgage servicing rights and subservicing products; conventional, government-insured, and non-agency mortgage loans, as well as reverse mortgage and multi-family loans; and residential forward mortgage and small commercial mortgage loans. It also originates and purchases conventional and government-insured residential forward and reverse mortgage loans through its correspondent lending arrangements, broker relationships, and retail channels. The company offers its services under the PHH Mortgage and Liberty Reverse Mortgage brands. It serves financial institutions. The company was formerly known as Ocwen Financial Corporation and changed its name to Onity Group Inc. in June 2024. Onity Group Inc. was founded in 1988 and is headquartered in West Palm Beach, Florida.

How the Company Makes Money

Onity generates revenue through the sale of its electronic locking solutions and security products, which are typically sold directly to hotels, educational institutions, and commercial enterprises. Key revenue streams include hardware sales from electronic locks and access control devices, software licensing for security management systems, and ongoing maintenance and support services. Additionally, Onity benefits from partnerships with hospitality management companies and technology integrators, which help expand its market reach and customer base. The company's focus on innovation, such as the development of mobile access solutions, also plays a significant role in driving revenue growth by meeting evolving customer demands for convenience and security.

Onity Group Financial Statement Overview

Summary

Onity Group's financial performance is challenged by high leverage, inconsistent profitability, and strained cash flow management. The balance sheet indicates financial risk due to high debt levels, and cash flow analysis shows negative free cash flow growth.

Income Statement

Onity Group's income statement shows a mixed performance. The gross profit margin has been relatively stable, but the net profit margin is weak due to inconsistent net income, with a recent return to profitability. Revenue growth has been inconsistent, with a decline in the latest year. EBIT and EBITDA margins are moderate, indicating operational efficiency but also highlighting challenges in maintaining profitability.

Balance Sheet

The balance sheet reveals high leverage, with a debt-to-equity ratio indicating significant reliance on debt financing. Return on equity is low, reflecting challenges in generating returns for shareholders. The equity ratio is weak, suggesting limited buffer against liabilities. Overall, the balance sheet indicates financial risk due to high debt levels.

Cash Flow

Cash flow analysis shows negative free cash flow growth, indicating cash outflows exceeding inflows. The operating cash flow to net income ratio is negative, highlighting operational cash challenges. Free cash flow to net income is also negative, suggesting difficulties in generating cash from operations. Overall, cash flow management appears strained.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.10B	1.07B	1.14B	999.50M	1.08B	976.80M
Gross Profit	515.80M	495.60M	584.50M	459.20M	521.00M	524.80M
EBITDA	238.50M	256.10M	238.80M	285.50M	235.80M	175.50M
Net Income	36.90M	33.90M	-63.70M	25.70M	18.10M	-40.20M
Balance Sheet
Total Assets	16.53B	16.44B	12.51B	12.40B	12.15B	10.65B
Cash, Cash Equivalents and Short-Term Investments	194.30M	184.80M	213.10M	274.20M	263.45M	357.26M
Total Debt	15.32B	14.74B	10.93B	10.46B	10.47B	9.29B
Total Liabilities	16.00B	15.94B	12.11B	11.94B	11.67B	10.24B
Stockholders Equity	531.80M	492.90M	401.80M	456.70M	476.70M	415.37M
Cash Flow
Free Cash Flow	-1.27B	-807.00M	-111.80M	-31.70M	-1.30B	-16.30M
Operating Cash Flow	-945.70M	-573.80M	10.40M	173.20M	-468.40M	261.00M
Investing Cash Flow	1.16B	401.30M	-100.30M	-120.80M	-1.01B	-527.90M
Financing Cash Flow	-206.50M	182.90M	70.80M	-13.40M	1.38B	131.80M

Onity Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 42.21
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ONIT, the sentiment is Positive. The current price of 42.21 is above the 20-day moving average (MA) of 39.85, above the 50-day MA of 38.56, and above the 200-day MA of 34.65, indicating a bullish trend. The MACD of 0.95 indicates Negative momentum. The RSI at 63.97 is Neutral, neither overbought nor oversold. The STOCH value of 79.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ONIT.

Onity Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	68 Neutral	$17.84B	12.03	10.32%	3.73%	9.70%	0.76%
VEL	68 Neutral	$733.41M	8.73	15.02%	―	35.12%	25.28%
ONIT	64 Neutral	$341.38M	10.75	7.55%	―	-2.84%	2420.57%
SNFCA	64 Neutral	$225.14M	9.90	6.65%	―	5.49%	4.30%
WD	61 Neutral	$2.91B	26.72	6.26%	3.06%	11.18%	24.94%
GHLD	58 Neutral	$1.24B	51.21	2.12%	2.49%	34.62%	-7.94%
LDI	57 Neutral	$671.78M	―	-23.67%	―	6.60%	44.77%

Onity Group Corporate Events

Onity Group Holds Annual Shareholder Meeting

On May 21, 2025, Onity Group held its Annual Meeting of Shareholders where three key proposals were voted on. Shareholders elected directors for one-year terms, ratified Deloitte & Touche LLP as the independent registered public accounting firm for 2025, and approved the executive compensation on a non-binding advisory basis.