Onity Group (ONIT) AI Stock Analysis

• Market Cap: $304.40M
• Dividend Yield: N/A
• Average Volume (3M): 44.91K
• Price to Earnings (P/E): 13.7
• Beta (1Y): 1.28
• Revenue Growth: -3.14%
• EPS Growth: 264.15%
• Country: US
• Employees: 4,200
• Sector: Financial
• Sector Strength: 79
• Industry: Financial - Mortgages
• EPS (TTM): 2.50
• Shares Outstanding: 8,008,515
• 10 Day Avg. Volume: 38,629
• 30 Day Avg. Volume: 44,910
• PEG Ratio: -0.02
• Price to Book (P/B): 0.02
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -2.16
• Enterprise Value/Market Cap: 27.56
• Enterprise Value/Revenue: 1.92
• Enterprise Value/Gross Profit: 16.34
• Enterprise Value/Ebitda: 8.25
• 1Y Price Target: $50.00
• Price Target Upside: 28.30% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 62 Neutral
• Price Target: $41.00 ▲(5.21%Upside)

Onity Group's overall stock score reflects a mix of strong technical indicators and earnings call results, balanced by significant financial performance concerns. The company's high leverage and cash flow challenges significantly impact its financial health, leading to a lower overall score. However, strong upward momentum in stock price and positive strategic growth and customer satisfaction trends provide a more optimistic outlook, albeit tempered by potential market volatility and legal challenges.

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

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Onity Group Financial Statement Overview

Summary

Onity Group shows moderate revenue growth and operational efficiency but faces significant leverage and liquidity challenges. The low net profit margin and negative cash flow metrics suggest financial pressures. The high debt-to-equity ratio raises concerns about financial stability, while the low equity ratio indicates limited cushion against liabilities. Overall, the financial health is strained, with key risks in leverage and cash flow management.

Income Statement

The gross profit margin for TTM is 47.15%, indicating moderate profitability. The net profit margin is low at 2.38%, reflecting challenges in cost management or pricing power. Revenue growth is sluggish, with TTM revenue growing by 1.82% compared to last year. EBIT margin stands at 20.65%, showing decent operating efficiency. However, the declining EBITDA margin of 21.34% suggests increasing operational costs.

Balance Sheet

The company's debt-to-equity ratio is high at 28.70, indicating substantial leverage and potential financial instability. ROE for TTM is weak at 5.08%, implying inefficient use of equity capital. The equity ratio is quite low at 3.14%, suggesting limited equity buffer against liabilities.

Cash Flow

Free cash flow growth is negative, with significant deterioration in TTM. The operating cash flow to net income ratio is negative, highlighting cash flow challenges. The free cash flow to net income ratio is also negative, reflecting cash constraints and potential liquidity issues.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.09B	1.07B	1.14B	999.50M	1.08B	976.80M
	Gross Profit
513.50M	495.60M	584.50M	459.20M	521.00M	524.80M
	EBIT
224.80M	247.80M	226.70M	270.70M	224.80M	0.00
	EBITDA
232.30M	256.10M	238.80M	285.50M	235.80M	175.50M
	Net Income Common Stockholders
25.90M	33.90M	-63.70M	25.70M	18.10M	-40.20M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
178.00M	184.80M	213.10M	274.20M	263.45M	357.26M
	Total Assets
16.26B	16.44B	12.51B	12.40B	12.15B	10.65B
	Total Debt
14.64B	14.74B	10.93B	10.46B	10.47B	9.29B
	Net Debt
14.46B	14.55B	10.73B	10.25B	10.28B	9.00B
	Total Liabilities
15.75B	15.94B	12.11B	11.94B	11.67B	10.24B
	Stockholders Equity
510.10M	492.90M	401.80M	456.70M	476.70M	415.37M
Cash Flow		Free Cash Flow
-729.90M	-807.00M	-111.80M	-31.70M	-1.30B	-16.30M
	Operating Cash Flow
-424.80M	-573.80M	10.40M	173.20M	-468.40M	261.00M
	Investing Cash Flow
824.70M	401.30M	-100.30M	-120.80M	-1.01B	-527.90M
	Financing Cash Flow
-414.30M	182.90M	70.80M	-13.40M	1.38B	131.80M

Onity Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 38.97
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• 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 38.97 is above the 20-day moving average (MA) of 37.80, above the 50-day MA of 34.83, and above the 200-day MA of 32.33, indicating a bullish trend. The MACD of 0.61 indicates Positive momentum. The RSI at 61.27 is Neutral, neither overbought nor oversold. The STOCH value of 57.73 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
VEL	68 Neutral	$694.43M	9.99	13.62%	―	32.62%	16.91%
Sector *	64 Neutral	$12.85B	9.81	7.79%	78.20%	12.23%	-7.93%
ONIT	62 Neutral	$304.40M	13.67	5.50%	―	-3.14%	264.15%
GHLD	57 Neutral	$934.40M	21.63	3.71%	3.33%	42.92%	64.72%
SNFCA	54 Neutral	$245.93M	10.43	7.02%	―	4.96%	12.42%
WD	49 Neutral	$2.43B	24.49	5.62%	3.75%	6.68%	6.08%
LDI	48 Neutral	$451.98M	―	-29.48%	―	3.76%	16.19%

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.

The most recent analyst rating on (ONIT) stock is a Buy with a $40.00 price target. To see the full list of analyst forecasts on Onity Group stock, see the ONIT Stock Forecast page.

Onity Group Reports Strong Q1 2025 Performance

On March 20, 2025, Onity Group Inc. hosted an investor presentation at the Sidoti March Virtual Investor Conference, where they provided a preliminary update on their financial and operating performance for the first quarter of 2025. The company reported a significant increase in originations volume compared to the first quarter of 2024, driven by their Correspondent and Co-Issue channels. Additionally, Onity launched an improved closed-end second originations product in February 2025, which has been well received by borrowers. The company also made progress in servicing growth, completing bulk MSR purchases, and adding new subservicing clients. Effective hedging strategies have contributed to consistent net income and GAAP ROE results, and there is potential for releasing some or all of the valuation allowance against its $180 million net U.S. deferred tax asset by year-end 2025.