Ready Capital (RC) AI Stock Analysis

• Market Cap: $345.33M
• Dividend Yield: 26.82%
• Average Volume (3M): 2.83M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.86
• Revenue Growth: -43.56%
• EPS Growth: -166.72%
• Country: US
• Employees: 475
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Mortgage
• EPS (TTM): -0.94
• Shares Outstanding: 162,126,280
• 10 Day Avg. Volume: 2,285,053
• 30 Day Avg. Volume: 2,832,301
• PEG Ratio: 0.01
• Price to Book (P/B): 0.63
• Price to Sales (P/S): 42.16
• P/FCF Ratio: -22.52
• Enterprise Value/Market Cap: 11.49
• Enterprise Value/Revenue: -429.22
• Enterprise Value/Gross Profit: -132.06
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $2.43
• Price Target Upside: 16.83% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 3
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 44 Neutral
• Price Target: $2.50 ▲(20.19% Upside)

The score is held down primarily by deteriorating financial performance (negative revenue and sizable net losses) and a bearish technical setup (below key moving averages with negative MACD). A very high dividend yield and improved TTM cash generation provide some support but do not outweigh the current loss profile and weak trend.

Positive Factors

Cash Flow Resilience

Positive free cash flow indicates Ready Capital's ability to generate cash, which is crucial for maintaining operations and servicing debt despite revenue challenges.

Partnerships for Capital Access

Strategic partnerships enhance Ready Capital's ability to access capital markets for securitization, supporting its lending capacity and risk management.

High Dividend Yield

A high dividend yield can attract income-focused investors, providing a buffer against stock price volatility and supporting shareholder returns.

Negative Factors

Declining Revenue

A significant revenue decline reflects operational challenges and market pressures, impacting Ready Capital's ability to sustain growth and profitability.

High Leverage

High leverage increases financial risk, potentially limiting Ready Capital's flexibility to invest in growth opportunities and manage economic downturns.

Negative Profitability

Sustained negative profitability undermines Ready Capital's financial health, necessitating strategic adjustments to improve operational efficiency and cost management.

Ready Capital Business Overview & Revenue Model

Company Description

Ready Capital Corporation operates as a real estate finance company in the United States. The company acquires, originates, manages, services, and finances small to medium balance commercial (SBC) loans, small business administration (SBA) loans, residential mortgage loans, and mortgage backed securities collateralized primarily by SBC loans, or other real estate-related investments. It operates through three segments: SBC Lending and Acquisitions; Small Business Lending; and Residential Mortgage Banking. The SBC Lending and Acquisitions segment, through its subsidiary, ReadyCap Commercial, LLC, originate SBC loans secured by stabilized or transitional investor properties using various loan origination channels. The Small Business Lending segment, through its subsidiary, ReadyCap Lending, LLC, acquires, originates, and services owner-occupied loans guaranteed by the SBA under its SBA Section 7(a) Program. The Residential Mortgage Banking segment, through its subsidiary, GMFS, LLC, originates residential mortgage loans. The company qualifies as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was formerly known as Sutherland Asset Management Corporation and changed its name to Ready Capital Corporation in September 2018. Ready Capital Corporation was founded in 2007 and is headquartered in New York, New York.

How the Company Makes Money

Ready Capital primarily makes money from (1) net interest income generated by earning interest on its loan and investment portfolio and paying interest on its financing facilities (including secured borrowings/warehouse lines, repurchase agreements, and securitizations), and (2) fee-based income tied to origination and servicing. Key revenue streams typically include: Interest income on originated and acquired loans (e.g., small-balance CRE loans, residential mortgages and related assets) and on real estate-related securities, minus interest expense on the debt and other funding used to finance those assets (the spread between asset yields and funding costs is a core driver of earnings). Origination-related fees and gains, which can include fees charged for originating loans and potential gains (or losses) from selling loans into the secondary market or securitizing them; in SBA-oriented lending, this commonly includes monetization of government-guaranteed portions when sold, along with related premium/fee income (specific program mix and amounts: null). Servicing income from servicing loans for its own portfolio and, where applicable, for third parties; this can include contractual servicing fees and ancillary servicing-related income, net of servicing costs. Other income items may include management of securitization vehicles and valuation changes on certain assets or hedges carried at fair value, which can affect reported earnings period-to-period (specific hedging strategy details: null). Factors influencing earnings include credit performance and loss provisions on loans, prepayment and origination volumes, the level and shape of interest rates (which affect both asset yields and funding costs), access to and pricing of secured financing/securitization markets, and the company’s ability to recycle capital through loan sales and securitizations.

Ready Capital Financial Statement Overview

Summary

Overall financials are fragile: revenue turned negative with a sharp collapse (TTM revenue growth -127%) and profitability remains deeply loss-making (TTM net income -$311M). Leverage has improved materially (debt-to-equity down to ~2.1x TTM), and TTM operating/free cash flow is positive (~$366M), but cash flows have been volatile and ROE is negative (~-16.8%).

Income Statement

Performance has deteriorated sharply: TTM (Trailing-Twelve-Months) revenue turned negative and collapsed versus the prior period (revenue growth -127%), while profitability swung deeply into losses (TTM net income -$311M after a -$436M loss in 2024). Although 2022–2023 showed solid revenue scale and positive earnings, the most recent results indicate severe pressure on earnings quality and business momentum.

Balance Sheet

Leverage remains high for a mortgage REIT, though it has improved: debt-to-equity declined from ~5.1–5.5x (2020–2022) to ~2.1x in TTM (Trailing-Twelve-Months). However, returns to shareholders are currently negative (TTM return on equity about -16.8%), and equity has trended down from 2023 to TTM, reflecting recent losses and weaker capital durability.

Cash Flow

Cash generation is currently a relative bright spot, with TTM (Trailing-Twelve-Months) operating cash flow and free cash flow both positive at ~$366M, a notable reversal from negative operating/free cash flow in 2024. That said, cash flow has been volatile over time (including deeply negative free cash flow in 2021) and the TTM free-cash-flow growth rate is sharply negative, suggesting the recent improvement may not be stable.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	-9.25M	27.35M	389.94M	383.33M	296.34M	384.65M
Gross Profit	-30.06M	27.35M	389.94M	383.33M	296.34M	384.65M
EBITDA	0.00	0.00	0.00	0.00	0.00	0.00
Net Income	-310.87M	-435.75M	339.45M	194.26M	157.74M	44.87M
Balance Sheet
Total Assets	8.33B	10.14B	12.44B	11.62B	9.53B	5.37B
Cash, Cash Equivalents and Short-Term Investments	147.51M	143.80M	148.27M	281.68M	229.53M	0.00
Total Debt	3.78B	6.04B	7.24B	9.34B	7.92B	4.12B
Total Liabilities	6.46B	8.21B	9.79B	9.72B	8.25B	4.54B
Stockholders Equity	1.77B	1.84B	2.55B	1.80B	1.28B	815.40M
Cash Flow
Free Cash Flow	366.24M	-51.22M	33.07M	359.15M	-3.74B	68.89M
Operating Cash Flow	366.24M	-51.22M	33.07M	359.15M	-34.44M	68.89M
Investing Cash Flow	1.93B	1.86B	1.04B	-1.56B	-1.72B	-59.44M
Financing Cash Flow	-2.35B	-1.88B	-1.09B	1.17B	1.88B	63.05M

Ready Capital Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.08
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RC, the sentiment is Negative. The current price of 2.08 is below the 20-day moving average (MA) of 2.19, below the 50-day MA of 2.31, and below the 200-day MA of 3.49, indicating a bearish trend. The MACD of -0.03 indicates Positive momentum. The RSI at 39.57 is Neutral, neither overbought nor oversold. The STOCH value of 9.06 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RC.

Ready Capital Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
TRTX	64 Neutral	$706.70M	13.86	5.87%	10.48%	-10.86%	-5.90%
IVR	59 Neutral	$609.42M	6.51	13.26%	16.08%	-53.20%	97.96%
KREF	52 Neutral	$544.23M	-23.89	-0.16%	11.33%	-24.37%	-19.19%
GPMT	46 Neutral	$100.97M	―	-9.11%	7.97%	-28.13%	62.49%
RC	44 Neutral	$345.33M	-1.06	-14.78%	26.82%	-43.56%	-166.72%
CMTG	44 Neutral	$384.20M	-1.07	-19.24%	―	-65.32%	-325.73%