Walker & Dunlop (WD) AI Stock Analysis

Compare

660 Followers

Top Page

Walker & Dunlop

(NYSE:WD)

Rating:66Neutral

Price Target:

$87.00

▲(4.48% Upside)

Walker & Dunlop's overall stock score is driven by strong earnings call results and positive technical indicators. However, financial performance concerns, particularly around profitability and cash flow, moderate the score. The valuation is reasonable, providing a balanced outlook.

Positive Factors

Business Diversification

WD's diverse business operations, including debt brokerage, investment sales, and asset management, contribute to over 70% of its cash flow from servicing and associated fees.

Market Position

WD has a strong market position with an 8% market share of multifamily debt originations, ranking #1 with Fannie Mae and #4 with Freddie Mac.

Valuation

WD's valuation is considered attractive at 13.3-15.5x 2025-2026E cash earnings, with potential for further improvement if GSE volumes exceed estimates.

Negative Factors

Market Supply

The multifamily market is expected to see an uptick in transactions due to projected increases in demand and a slowdown in supply, benefiting companies like WD.

Walker & Dunlop (WD) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$2.84B

Dividend Yield3.17%

Average Volume (3M)282.46K

Price to Earnings (P/E)25.7

Beta (1Y)1.13

Revenue Growth11.18%

EPS Growth24.94%

CountryUS

Employees1,394

SectorFinancial

Sector Strength70

IndustryFinancial - Mortgages

Share Statistics

EPS (TTM)0.99

Shares Outstanding34,069,120

10 Day Avg. Volume339,087

30 Day Avg. Volume282,460

Financial Highlights & Ratios

PEG Ratio-95.24

Price to Book (P/B)1.84

Price to Sales (P/S)2.84

P/FCF Ratio27.66

Enterprise Value/Market Cap1.42

Enterprise Value/Revenue3.53

Enterprise Value/Gross Profit5.75

Enterprise Value/Ebitda10.77

Forecast

1Y Price Target

$99.00

Price Target Upside18.89% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering3

Walker & Dunlop Business Overview & Revenue Model

Company DescriptionWalker & Dunlop (WD) is a leading commercial real estate services and finance company based in the United States. Specializing in multifamily and commercial property financing, the company offers a broad range of services, including loan origination, underwriting, and servicing. WD operates across various sectors, including multifamily housing, healthcare, and retail, providing tailored financial solutions to meet the diverse needs of property owners and investors.

How the Company Makes MoneyWalker & Dunlop generates revenue primarily through its loan origination and servicing activities. The company earns fees from originating loans for commercial properties, which typically includes a percentage of the loan amount. Additionally, it collects servicing fees for managing loans after they are originated, which provides a steady income stream. Other revenue sources include advisory services, property management, and capital markets activities. Significant partnerships with government agencies, such as Fannie Mae and Freddie Mac, enhance WD's ability to offer competitive financing options, further contributing to its earnings.

Walker & Dunlop Earnings Call Summary

Earnings Call Date:Aug 07, 2025

(Q2-2025)

% Change Since: 10.32%|

Next Earnings Date:Nov 06, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong transaction volume growth, robust performance in the multifamily sector, and significant advancements in technology and affordable housing initiatives. However, there were challenges with declines in adjusted metrics and servicing revenues, as well as a provision for loan losses.

Q2-2025 Updates

Positive Updates

Significant Increase in Transaction Volume

Q2 2025 total transaction volume reached $14 billion, up 65% from Q2 2024 and over twice the volume in Q1 2025.

Revenue and Earnings Growth

18% revenue growth and diluted earnings per share of $0.99, a 48% increase year-over-year.

Strong Multifamily Sector Performance

Record absorption of 227,000 units in Q2 2025, with 96% occupancy and substantial growth in renter households.

Expansion in GSE and Brokered Debt Volume

GSE lending volume reached $4.9 billion, the highest in 11 quarters. Brokered debt volume grew to $6.3 billion, up 64% year-over-year.

Growth in Affordable Housing Initiatives

HUD lending volumes grew 55% to $288 million, and the largest ever $240 million multi-investor fund syndication was completed.

Technological Advancements

Galaxy loan database contributed to 17% of transaction volume from new clients, with 5,600 active users on the Client Navigator platform.

Negative Updates

Decline in Adjusted Metrics

Adjusted EBITDA declined 5% and adjusted core EPS declined 7% due to a 100 basis point decrease in short-term rates.

Decrease in Servicing & Asset Management Revenues

Total SAM revenues declined 5% year-over-year, primarily due to a 12% decrease in placement fees and a 49% drop in investment management fees.

Loan Loss Provision

A $1.8 million provision for loan losses was recognized due to updated valuations for previously defaulted loans.

Company Guidance

During the second quarter of 2025, Walker & Dunlop, Incorporated reported a significant increase in total transaction volume, reaching $14 billion, which marks a 65% increase from the same period in 2024 and more than double the volume of the first quarter of 2025. This surge in activity contributed to an 18% growth in revenue and a 48% year-over-year increase in diluted earnings per share, reaching $0.99. Despite a 5% decline in adjusted EBITDA and a 7% decrease in adjusted core EPS, attributed to a 100 basis point decrease in short-term interest rates affecting escrow earnings, the company saw substantial growth across various transaction channels, including $4.9 billion in GSE lending, $2.3 billion in property sales, and $6.3 billion in brokered debt volume. The quarter also witnessed a 55% increase in HUD lending volumes and significant growth in technology-enabled businesses, with appraisal revenues up 61% and small balance lending revenue nearly doubling. The company raised $240 million in a multi-investor fund syndication, the largest in its history, and noted a rise in its GSE market share to 11.4%. With a strong pipeline and increased liquidity in the commercial real estate lending markets, Walker & Dunlop is well-positioned for continued growth in the next market cycle.

Walker & Dunlop Financial Statement Overview

Summary

Walker & Dunlop shows stable revenue but faces pressures on profitability and cash flow. The increase in leverage and negative cash flow are concerning, despite better cost management.

Income Statement

Neutral

Walker & Dunlop's TTM (Trailing-Twelve-Months) revenue shows a slight increase from the previous year, with a revenue growth rate of approximately 0.82%. However, the company experienced a decline in net profit margin to 8.67% compared to 9.55% in the previous year, indicating pressure on profitability. The gross profit margin improved to 61.30%, suggesting better cost management, but EBIT margin fell to 9.42%, reflecting potential inefficiencies in operations.

Balance Sheet

Neutral

The company has a solid equity base with an equity ratio of 38.39%, providing a buffer against liabilities. However, the debt-to-equity ratio has increased to 1.01, indicating higher leverage which could pose risks in a rising interest rate environment. The return on equity (ROE) has decreased to 5.72%, showing reduced efficiency in generating profits from shareholders' equity.

Cash Flow

Negative

Operating cash flow has turned negative in the TTM period, signaling potential liquidity concerns. The free cash flow to net income ratio is also negative, highlighting challenges in converting income into cash. The negative free cash flow growth rate indicates declining cash generation capability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.14B	1.13B	1.05B	1.26B	1.26B	1.08B
Gross Profit	700.10M	503.56M	471.67M	617.15M	647.71M	606.34M
EBITDA	373.92M	369.23M	363.50M	500.00M	569.23M	499.28M
Net Income	99.06M	108.17M	107.36M	213.82M	265.76M	246.18M
Balance Sheet
Total Assets	4.51B	4.38B	4.05B	4.05B	5.21B	4.65B
Cash, Cash Equivalents and Short-Term Investments	180.97M	279.27M	328.70M	225.95M	305.63M	321.10M
Total Debt	1.76B	1.66B	1.47B	1.32B	2.68B	2.81B
Total Liabilities	2.77B	2.62B	2.31B	2.33B	3.47B	3.45B
Stockholders Equity	1.73B	1.75B	1.72B	1.69B	1.55B	1.20B
Cash Flow
Free Cash Flow	-203.51M	116.40M	-16.72M	1.56B	861.25M	-1.41B
Operating Cash Flow	-190.15M	129.36M	-518.00K	1.58B	870.46M	-1.41B
Investing Cash Flow	-48.47M	-38.13M	126.87M	-133.78M	-377.55M	115.18M
Financing Cash Flow	191.45M	-154.73M	6.77M	-1.58B	-457.73M	1.52B

Walker & Dunlop Technical Analysis

Technical Analysis Sentiment

Positive

Last Price83.27

Price Trends

50DMA

72.89

Positive

100DMA

74.05

Positive

200DMA

85.27

Negative

Market Momentum

MACD

1.90

Negative

RSI

68.81

Neutral

STOCH

79.04

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WD, the sentiment is Positive. The current price of 83.27 is above the 20-day moving average (MA) of 76.21, above the 50-day MA of 72.89, and below the 200-day MA of 85.27, indicating a neutral trend. The MACD of 1.90 indicates Negative momentum. The RSI at 68.81 is Neutral, neither overbought nor oversold. The STOCH value of 79.04 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WD.

Walker & Dunlop Risk Analysis

Walker & Dunlop disclosed 29 risk factors in its most recent earnings report. Walker & Dunlop reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Walker & Dunlop Peers Comparison

Overall Rating

UnderperformOutperform

Sector (58)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
COOP	69 Neutral	$12.27B	21.92	11.76%	―	2.27%	-17.46%
WD	66 Neutral	$2.84B	25.69	6.26%	3.17%	11.18%	24.94%
PFSI	64 Neutral	$5.31B	14.24	10.05%	1.22%	20.77%	96.22%
Sector *	58 Neutral	HK$111.68B	6.58	-4.20%	3.95%	9.04%	-46.99%
RKT	58 Neutral	$4.37B	68.51	>-0.01%	―	21.52%	-103.65%
GHLD	57 Neutral	$1.25B	51.69	2.12%	2.48%	34.62%	-7.94%
LDI	48 Neutral	$635.54M	―	-23.67%	―	6.60%	44.77%

* Financial Sector Average

Performance Comparison

Walker & Dunlop

83.27

-16.05

-16.16%

PFSI

PennyMac Financial

102.71

4.08

4.14%

COOP

Mr Cooper Group

202.86

114.07

128.47%

LDI

loanDepot

1.99

-0.55

-21.65%

RKT

Rocket Companies

19.62

1.58

8.76%

GHLD

Guild Holdings

20.07

5.47

37.47%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 12, 2025