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Mr. Cooper Group Reports Third Quarter 2024 Results

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Mr. Cooper Group (NASDAQ: COOP) reported third quarter net income of $80 million, with pretax operating income of $246 million. The company achieved an operating ROTCE of 16.8% and grew its servicing portfolio by 32% year-over-year to $1,239 billion. Originations segment funded volume increased 80% quarter-over-quarter to $6.8 billion. The company repurchased 0.5 million shares for $46 million and issued $750 million senior notes at 6.5%. The servicing portfolio maintained strong performance with a 1.5% delinquency rate, while the company's book value per share increased to $72.49.

Mr. Cooper Group (NASDAQ: COOP) ha riportato un reddito netto di terzo trimestre pari a 80 milioni di dollari, con un reddito operativo ante imposte di 246 milioni di dollari. La società ha raggiunto un ROTCE operativo del 16,8% e ha aumentato il suo portafoglio di servicing del 32% su base annua, arrivando a 1.239 miliardi di dollari. Il volume di finanziamenti del segmento origination è aumentato dell'80% rispetto al trimestre precedente, toccando 6,8 miliardi di dollari. L'azienda ha riacquistato 0,5 milioni di azioni per 46 milioni di dollari ed emesso note senior per 750 milioni di dollari con un tasso del 6,5%. Il portafoglio di servicing ha mantenuto una forte performance con un tasso di insolvenza dell'1,5%, mentre il valore contabile per azione della società è aumentato a 72,49 dollari.

Mr. Cooper Group (NASDAQ: COOP) reportó un ingreso neto del tercer trimestre de 80 millones de dólares, con un ingreso operativo antes de impuestos de 246 millones de dólares. La compañía consiguió un ROTCE operativo del 16,8% y creció su portafolio de servicios un 32% interanual, alcanzando 1,239 mil millones de dólares. El volumen financiado del segmento de originaciones aumentó un 80% trimestre a trimestre, llegando a 6.8 mil millones de dólares. La empresa recompró 0.5 millones de acciones por 46 millones de dólares y emitió notas senior por 750 millones de dólares a un 6.5%. El portafolio de servicios mantuvo un rendimiento fuerte con una tasa de morosidad del 1.5%, mientras que el valor contable por acción de la compañía aumentó a 72.49 dólares.

Mr. Cooper Group (NASDAQ: COOP)는 3분기 순이익이 8천만 달러인 것으로 보고했으며, 세전 운영 수익은 2억 4천6백만 달러입니다. 이 회사는 16.8%의 운영 ROTCE를 달성했으며, 서비스 포트폴리오를 전년 대비 32% 성장시켜 1,239억 달러에 도달했습니다. 기원 세그먼트의 자금 조달량은 전분기 대비 80% 증가해 68억 달러에 이르렀습니다. 이 회사는 46백만 달러에 50만 주를 재매입했으며, 6.5%의 이자를 가진 7억 5천만 달러의 선순위 노트를 발행했습니다. 서비스 포트폴리오는 1.5%의 체납률로 강력한 성과를 유지했으며, 회사의 주당 장부가치는 72.49달러로 증가했습니다.

Mr. Cooper Group (NASDAQ: COOP) a rapporté un revenu net pour le troisième trimestre de 80 millions de dollars, avec un revenu d'exploitation avant impôts de 246 millions de dollars. La société a réalisé un ROTCE opérationnel de 16,8% et a augmenté son portefeuille de services de 32% d'une année sur l'autre, atteignant 1,239 milliards de dollars. Le volume des financements du segment des origination a augmenté de 80% par rapport au trimestre précédent, atteignant 6,8 milliards de dollars. L'entreprise a racheté 0,5 million d'actions pour 46 millions de dollars et a émis des obligations senior de 750 millions de dollars à 6,5%. Le portefeuille de services a maintenu une performance solide avec un taux de retard de 1,5%, tandis que la valeur comptable par action de la société a augmenté à 72,49 dollars.

Mr. Cooper Group (NASDAQ: COOP) meldete im dritten Quartal einen Nettogewinn von 80 Millionen Dollar und ein operatives Ergebnis vor Steuern von 246 Millionen Dollar. Das Unternehmen erzielte eine betriebliche ROTCE von 16,8% und steigerte sein Servicing-Portfolio um 32% im Jahresvergleich auf 1,239 Milliarden Dollar. Das Finanzierungsvolumen im Segment Originierungen stieg im Vergleich zum Vorquartal um 80% auf 6,8 Milliarden Dollar. Das Unternehmen hat 0,5 Millionen Aktien für 46 Millionen Dollar zurückgekauft und Senior Notes in Höhe von 750 Millionen Dollar mit 6,5% ausgegeben. Das Servicing-Portfolio hielt eine starke Leistung mit einer Rückstandquote von 1,5%, während der Buchwert pro Aktie des Unternehmens auf 72,49 Dollar stieg.

Positive
  • Servicing portfolio grew 32% year-over-year to $1,239 billion
  • Originations funded volume increased 80% quarter-over-quarter to $6.8 billion
  • Operating ROTCE of 16.8%
  • Pretax operating income of $246 million
  • Strong refinance recapture rate of 69%
Negative
  • Other mark-to-market loss of $126 million
  • Slight increase in 60+ day delinquency rate to 1.5% from 1.4% quarter-over-quarter

Insights

Mr. Cooper Group delivered a solid Q3 2024 with notable achievements. Net income reached $80 million, though impacted by a $126 million mark-to-market loss. The servicing portfolio showed impressive 32% year-over-year growth to $1,239 billion. Key highlights include:

  • Operating ROTCE of 16.8% demonstrates strong operational efficiency
  • Direct-to-consumer originations saw 80% quarter-over-quarter volume increase
  • Successfully issued $750 million senior notes at 6.5%
  • Maintained healthy delinquency rate of 1.5%

The upcoming Flagstar mortgage operations acquisition positions the company for further growth. Strong liquidity and portfolio expansion indicate positive momentum, though rising rates may impact refinancing volumes.

  • Reported net income of $80 million including other mark-to-market of ($126) million, equivalent to ROCE of 6.9% and operating ROTCE of 16.8%
  • Book value per share and tangible book value per share increased to $72.49 and $69.93
  • Servicing portfolio grew 32% y/y to $1,239 billion
  • Repurchased 0.5 million shares of common stock for $46 million
  • Issued $750 million senior notes priced at 6.5%
  • Certified as Great Place to Work for the 6th year in a row

DALLAS--(BUSINESS WIRE)-- Mr. Cooper Group Inc. (NASDAQ: COOP) (the “Company”), reported third quarter income before income tax expense of $112 million and net income of $80 million. Excluding other mark-to-market and other adjustments, the Company reported pretax operating income of $246 million. Adjustments included other mark-to-market net of hedges of $126 million and other items shown below in the reconciliation of GAAP and non-GAAP results.

Chairman and CEO Jay Bray commented, “We delivered an exceptional quarter, marked by an operating ROTCE of 16.8%, and record liquidity. We are excited to welcome our new team members, with the acquisition of Flagstar’s mortgage operations on target to close, as announced, in the fourth quarter.”

Mike Weinbach, President added, “I’m extremely pleased with our strong performance in servicing and exceptional execution in originations, where volumes increased 80% quarter-over-quarter, as our direct-to-consumer channel helped customers take advantage of the rally in mortgage rates during September, while our correspondent channel implemented a number of new initiatives which were well-received by clients.”

Servicing

The Servicing segment provides a best-in-class home loan experience for our 5.4 million customers while simultaneously strengthening asset performance for investors. In the third quarter, Servicing recorded pre-tax income of $177 million inclusive of other mark-to-market loss of $126 million and pretax operating income of $305 million. The servicing portfolio ended the quarter at $1,239 billion. At quarter end, the carrying value of the MSR was $10,035 million equivalent to 148 bps of MSR UPB.

 

Quarter Ended

($ in millions)

Q3'24

 

Q2'24

 

$

 

BPS

 

$

 

BPS

Operational revenue

$

616

 

 

 

20.1

 

 

$

604

 

 

 

20.7

 

Amortization, net of accretion

 

(235

)

 

 

(7.6

)

 

 

(217

)

 

 

(7.4

)

Mark-to-market

 

(125

)

 

 

(4.1

)

 

 

69

 

 

 

2.3

 

Total revenues

 

256

 

 

 

8.4

 

 

 

456

 

 

 

15.6

 

Total expenses

 

(180

)

 

 

(5.9

)

 

 

(171

)

 

 

(5.9

)

Total other income, net

 

101

 

 

 

3.3

 

 

 

69

 

 

 

2.4

 

Income before taxes

 

177

 

 

 

5.8

 

 

 

354

 

 

 

12.1

 

Other mark-to-market

 

126

 

 

 

4.1

 

 

 

(68

)

 

 

(2.4

)

Accounting items

 

 

 

 

 

 

 

 

 

 

 

Intangible amortization

 

2

 

 

 

0.1

 

 

 

2

 

 

 

0.1

 

Pretax operating income excluding other mark-to-market and accounting items

$

305

 

 

 

10.0

 

 

$

288

 

 

9.8

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Q3'24

 

Q2'24

MSRs UPB ($B)

$

678

 

 

$

676

 

Subservicing and Other UPB ($B)

 

561

 

 

 

530

 

Ending UPB ($B)

$

1,239

 

 

$

1,206

 

Average UPB ($B)

$

1,225

 

 

$

1,171

 

60+ day delinquency rate at period end

 

1.5

%

 

 

1.4

%

Annualized CPR

 

7.1

%

 

 

5.6

%

Modifications and workouts

 

21,817

 

 

 

22,645

 

Originations

The Originations segment creates servicing assets at attractive margins by acquiring loans through the correspondent channel and refinancing existing loans through the direct-to-consumer channel. Originations earned pretax income and pretax operating income of $69 million.

The Company funded 25,582 loans in the third quarter, totaling approximately $6.8 billion UPB, which was comprised of $2.3 billion in direct-to-consumer and $4.5 billion in correspondent. Funded volume increased 80% quarter-over-quarter, while pull through adjusted volume increased 67% quarter-over-quarter to $7.5 billion.

 

Quarter Ended

($ in millions)

Q3'24

 

Q2'24

Income before taxes

$

69

 

$

38

Accounting items

 

 

 

Pretax operating income excluding accounting items and other

$

69

 

$

38

 

Quarter Ended

($ in millions)

Q3'24

 

Q2'24

Total pull through adjusted volume

$

7,491

 

 

$

4,473

 

Funded volume

$

6,825

 

 

$

3,794

 

Refinance recapture percentage

 

69

%

 

 

73

%

Recapture percentage

 

22

%

 

 

22

%

Purchase volume as a percentage of funded volume

 

69

%

 

 

62

%

Conference Call Webcast and Investor Presentation

The Company will host a conference call on October 23, 2024 at 10:00 A.M. Eastern Time. Preregistration for the call is now available in the Investor section of www.mrcoopergroup.com. Participants will receive a toll-free dial-in number and a unique registrant ID to be used for immediate call access. A simultaneous audio webcast of the conference call will be available under the investors section on www.mrcoopergroup.com.

Non-GAAP Financial Measures

The Company utilizes non-GAAP financial measures as the measures provide additional information to assist investors in understanding and assessing the Company’s and our business segments’ ongoing performance and financial results, as well as assessing our prospects for future performance. The adjusted operating financial measures facilitate a meaningful analysis and allow more accurate comparisons of our ongoing business operations because they exclude items that may not be indicative of or are unrelated to the Company’s and our business segments’ core operating performance, and are better measures for assessing trends in our underlying businesses. These notable items are consistent with how management views our businesses. Management uses these non-GAAP financial measures in making financial, operational and planning decisions and evaluating the Company’s and our business segment’s ongoing performance. Pretax operating income (loss) in the servicing segment eliminates the effects of mark-to-market adjustments which primarily reflects unrealized gains or losses based on the changes in fair value measurements of MSRs and their related financing liabilities for which a fair value accounting election was made. These adjustments, which can be highly volatile and material due to changes in credit markets, are not necessarily reflective of the gains and losses that will ultimately be realized by the Company. Pretax operating income (loss) in each segment also eliminates, as applicable, transition and integration costs, gains (losses) on sales of fixed assets, certain settlement costs that are not considered normal operational matters, intangible amortization, change in equity method investments, fair value change in equity investments and other adjustments based on the facts and circumstances that would provide investors a supplemental means for evaluating the Company’s core operating performance. Return on tangible common equity (ROTCE) is computed by dividing net income by average tangible common equity (also known as tangible book value). Tangible common equity equals total stockholders’ equity less goodwill and intangible assets. Management believes that ROTCE is a useful financial measure because it measures the performance of a business consistently and enables investors and others to assess the Company’s use of equity. Tangible book value is defined as stockholders’ equity less goodwill and intangible assets. Our management believes tangible book value is useful to investors because it provides a more accurate measure of the realizable value of shareholder returns, excluding the impact of goodwill and intangible assets.

Forward Looking Statements

Any statements in this release that are not historical or current facts are forward looking statements. Forward looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Results for any specified quarter are not necessarily indicative of the results that may be expected for the full year or any future period. Certain of these risks and uncertainties are described in the “Risk Factors” section of Mr. Cooper Group’s most recent annual reports and other required documents as filed with the SEC which are available at the SEC’s website at http://www.sec.gov. Mr. Cooper undertakes no obligation to publicly update or revise any forward-looking statement or any other financial information contained herein, and the statements made in this press release are current as of the date of this release only.

Financial Tables

MR. COOPER GROUP INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(millions of dollars, except for earnings per share data)

 

 

 

 

Three Months Ended September 30, 2024

 

Three Months Ended June 30, 2024

Revenues:

 

 

 

Service related, net

$

288

 

 

$

485

 

Net gain on mortgage loans held for sale

 

136

 

 

 

98

 

Total revenues

 

424

 

 

 

583

 

Total expenses:

 

335

 

 

 

300

 

Other (expense) income, net:

 

 

 

Interest income

 

227

 

 

 

189

 

Interest expense

 

(199

)

 

 

(187

)

Other expense, net

 

(5

)

 

 

(8

)

Total other expense, net

 

23

 

 

 

(6

)

Income before income tax expense

 

112

 

 

 

277

 

Income tax expense

 

32

 

 

 

73

 

Net income

$

80

 

 

$

204

 

 

 

 

 

Earnings per share:

 

 

 

Basic

$

1.24

 

 

$

3.16

 

Diluted

$

1.22

 

 

$

3.10

 

Weighted average shares of common stock outstanding (in millions):

 

 

 

Basic

 

64.3

 

 

 

64.6

 

Diluted

 

65.5

 

 

 

65.8

 

 

MR. COOPER GROUP INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(millions of dollars)

 

 

 

 

 

 

September 30, 2024

 

June 30, 2024

Assets

 

 

 

Cash and cash equivalents

$

733

 

$

642

Restricted cash

 

186

 

 

162

Mortgage servicing rights at fair value

 

10,035

 

 

10,352

Advances and other receivables, net

 

940

 

 

934

Mortgage loans held for sale at fair value

 

1,962

 

 

1,539

Property and equipment, net

 

58

 

 

57

Deferred tax assets, net

 

315

 

 

351

Other assets

 

1,957

 

 

1,746

Total assets

$

16,186

 

$

15,783

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

Unsecured senior notes, net

$

4,885

 

$

4,141

Advance, warehouse and MSR facilities, net

 

4,379

 

 

4,925

Payables and other liabilities

 

1,841

 

 

1,684

MSR related liabilities - nonrecourse at fair value

 

443

 

 

439

Total liabilities

 

11,548

 

 

11,189

Total stockholders' equity

 

4,638

 

 

4,594

Total liabilities and stockholders' equity

$

16,186

 

$

15,783

 

UNAUDITED SEGMENT STATEMENT OF

OPERATIONS & EARNINGS RECONCILIATION

(millions of dollars, except for earnings per share data)

 

 

 

Three Months Ended September 30, 2024

 

Servicing

 

Originations

 

Corporate/ Other

 

Consolidated

 

 

 

 

 

 

 

 

Service related, net

$

246

 

 

$

24

 

 

$

18

 

 

$

288

 

Net gain on mortgage loans held for sale

 

10

 

 

 

126

 

 

 

 

 

 

136

 

Total revenues

 

256

 

 

 

150

 

 

 

18

 

 

 

424

 

Total expenses

 

180

 

 

 

83

 

 

 

72

 

 

 

335

 

Other income (expense), net:

 

 

 

 

 

 

 

Interest income

 

201

 

 

 

25

 

 

 

1

 

 

 

227

 

Interest expense

 

(100

)

 

 

(23

)

 

 

(76

)

 

 

(199

)

Other expense, net

 

 

 

 

 

 

 

(5

)

 

 

(5

)

Total other income (expense), net

 

101

 

 

 

2

 

 

 

(80

)

 

 

23

 

Pretax income (loss)

$

177

 

 

$

69

 

 

$

(134

)

 

$

112

 

Income tax expense

 

 

 

 

 

 

32

 

Net income

 

 

 

 

$

80

 

Earnings per share

 

 

 

 

 

Basic

 

 

 

 

$

1.24

 

Diluted

 

 

 

 

 

$

1.22

 

 

 

 

 

 

 

 

Non-GAAP Reconciliation:

 

 

 

 

 

Pretax income (loss)

$

177

 

 

$

69

 

 

$

(134

)

 

$

112

 

Other mark-to-market

 

126

 

 

 

 

 

 

 

 

 

126

 

Accounting items / other

 

 

 

 

 

 

 

6

 

 

 

6

 

Intangible amortization

 

2

 

 

 

 

 

 

 

 

 

2

 

Pretax operating income (loss)

$

305

 

 

$

69

 

 

$

(128

)

 

$

246

 

Income tax expense(1)

 

 

 

 

 

 

(60

)

Operating income

 

 

 

 

 

 

$

186

 

Operating ROTCE(2)

 

 

 

 

16.8

%

Average tangible book value (TBV)(3)

 

 

 

 

$

4,451

 

(1)

Assumes tax-rate of 24.2%.

(2)

Computed by dividing annualized earnings by average TBV.

(3)

Average of beginning TBV of $4,428 and ending TBV of $4,474.

UNAUDITED SEGMENT STATEMENT OF

OPERATIONS & EARNINGS RECONCILIATION

(millions of dollars, except for earnings per share data)

 

 

 

Three Months Ended June 30, 2024

 

Servicing

 

Originations

 

Corporate/ Other

 

Consolidated

 

 

 

 

 

 

 

 

Service related, net

$

446

 

 

$

19

 

 

$

20

 

 

$

485

 

Net gain on mortgage loans held for sale

 

10

 

 

 

88

 

 

 

 

 

 

98

 

Total revenues

 

456

 

 

 

107

 

 

 

20

 

 

 

583

 

Total expenses

 

171

 

 

 

69

 

 

 

60

 

 

 

300

 

Other income (expense), net:

 

 

 

 

 

 

 

Interest income

 

174

 

 

 

15

 

 

 

 

 

 

189

 

Interest expense

 

(105

)

 

 

(15

)

 

 

(67

)

 

 

(187

)

Other expense, net

 

 

 

 

 

 

 

(8

)

 

 

(8

)

Total other income (expense), net

 

69

 

 

 

 

 

 

(75

)

 

 

(6

)

Pretax income (loss)

$

354

 

 

$

38

 

 

$

(115

)

 

$

277

 

Income tax expense

 

 

 

 

 

 

 

73

 

Net income

 

 

 

 

 

 

$

204

 

Earnings per share

 

 

 

 

 

 

 

Basic

 

 

 

 

 

 

$

3.16

 

Diluted

 

 

 

 

 

 

$

3.10

 

 

 

 

 

 

 

 

 

Non-GAAP Reconciliation:

 

 

 

 

 

 

 

Pretax income (loss)

$

354

 

 

$

38

 

 

$

(115

)

 

$

277

 

Other mark-to-market

 

(68

)

 

 

 

 

 

 

 

 

(68

)

Accounting items / other

 

 

 

 

 

 

 

8

 

 

 

8

 

Intangible amortization

 

2

 

 

 

 

 

 

 

 

 

2

 

Pretax operating income (loss)

$

288

 

 

$

38

 

 

$

(107

)

 

$

219

 

Income tax expense

 

 

 

 

 

 

 

(53

)

Operating income(1)

 

 

 

 

 

 

$

166

 

Operating ROTCE(2)

 

 

 

 

 

 

 

15.3

%

Average tangible book value (TBV)(3)

 

 

 

 

 

 

$

4,333

 

(1)

Assumes tax-rate of 24.2%.

(2)

Computed by dividing annualized earnings by average TBV.

(3)

Average of beginning TBV of $4,238 and ending TBV of $4,428.

Non-GAAP Reconciliation:

Quarter Ended

($ in millions except value per share data)

Q3'24

 

Q2'24

Stockholders' equity (BV)

$

4,638

 

 

$

4,594

 

Goodwill

 

(141

)

 

 

(141

)

Intangible assets

 

(23

)

 

 

(25

)

Tangible book value (TBV)

$

4,474

 

 

$

4,428

 

Ending shares of common stock outstanding (in millions)

 

64.0

 

 

 

64.5

 

 

 

 

 

BV/share

$

72.49

 

 

$

71.24

 

TBV/share

$

69.93

 

 

$

68.67

 

 

 

 

 

Net income

$

80

 

 

$

204

 

ROCE(1)

 

6.9

%

 

 

18.1

%

 

 

 

 

Beginning stockholders’ equity

$

4,594

 

 

$

4,405

 

Ending stockholders’ equity

$

4,638

 

 

$

4,594

 

Average stockholders’ equity (BV)

$

4,616

 

 

$

4,500

(1)

Return on Common Equity (ROCE) is computed by dividing annualized earnings by average BV.

 

Investor Contact:

Kenneth Posner, SVP Strategic Planning and Investor Relations

(469) 426-3633

Shareholders@mrcooper.com



Media Contact:

Christen Reyenga, VP Corporate Communications

MediaRelations@mrcooper.com

Source: Mr. Cooper Group Inc.

FAQ

What was Mr. Cooper Group's (COOP) net income in Q3 2024?

Mr. Cooper Group reported a net income of $80 million in Q3 2024.

How much did COOP's servicing portfolio grow in Q3 2024?

The servicing portfolio grew 32% year-over-year to $1,239 billion.

What was COOP's originations volume in Q3 2024?

The originations funded volume was $6.8 billion, increasing 80% quarter-over-quarter.

How many shares did Mr. Cooper Group (COOP) repurchase in Q3 2024?

The company repurchased 0.5 million shares for $46 million.

Mr. Cooper Group Inc.

NASDAQ:COOP

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5.79B
63.98M
3.62%
90.53%
2.29%
Mortgage Finance
Finance Services
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United States of America
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