Financial Data and Key Metrics Changes - The company reported a return on tangible common equity (ROTCE) of 16.8%, an increase from 15.8% in the previous quarter, reflecting the benefits from the Flagstar acquisition [8] - Net income for the quarter was $88 million, which included $255 million in pretax operating earnings offset by an $82 million negative mark on mortgage servicing rights (MSR) [28][30] - The capital ratio stood at 25.5%, indicating a strong balance sheet, with liquidity increasing to $3.9 billion [10][35] Business Line Data and Key Metrics Changes - The servicing segment generated pretax income of $332 million, up 22% year over year, attributed to slower than expected conditional prepayment rates (CPR) and lower amortization [15] - Originations produced $53 million in earnings before tax (EBT), slightly above guidance, with strong volumes in the correspondent channel [20] - Home equity loans and cash-out refinances showed significant growth, with cash-outs making up 46% of volume, up from 39% in the previous quarter [22] Market Data and Key Metrics Changes - The total portfolio decreased slightly to $1.5 trillion, with over 6.4 million customers, while the subservicing portfolio grew organically by 2% quarter over quarter [18][19] - The company closed approximately $7 billion in bulk acquisitions, indicating strong activity in the correspondent channel [20] Company Strategy and Development Direction - The pending combination with Rocket aims to create a scaled homeownership experience, leveraging technology and AI to enhance customer experience [4][5] - The integration of Flagstar is on schedule, with onboarding of new customers and team members completed [11][16] - The focus on operational excellence and customer trust is emphasized as a key driver for long-term growth [14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, highlighting the potential for growth in home equity loans and cash-out refinances regardless of interest rate fluctuations [13][22] - The company is well-positioned to manage potential adverse market conditions, with strong asset quality and low delinquency rates [32][34] Other Important Information - The company incurred $26 million in transaction and transition charges related to the Flagstar integration and an additional $33 million charge for legal fees [29] - The hedge gains amounted to $209 million, contributing to stable and predictable results [31] - The company does not expect to repurchase stock prior to the closing of the Rocket transaction, anticipated in the fourth quarter of 2025 [37] Summary of Q&A Session - No questions were taken during the call due to the pending combination with Rocket, as stated by management [3]

Core Viewpoint - Mr. Cooper Group Inc. reported strong adjusted earnings per share of $2.97 for Q1 2025, exceeding estimates by 5.7% and reflecting a 30.3% year-over-year increase, despite a significant decline in net income [1][2] Group 1: Financial Performance - Total revenues for Q1 2025 decreased by 0.7% year over year to $560 million, missing consensus estimates by 8.6% [2] - Total expenses rose by 35.6% year over year to $430 million, with interest income increasing by 19.6% to $189 million and interest expenses rising by 25.3% to $213 million [2] Group 2: Segment Performance - The Servicing segment achieved a pre-tax operating income of $332 million, up 21.6% year over year, despite total revenues falling by 10.4% to $403 million [3] - The Originations segment reported a pre-tax operating income of $53 million, a 65.6% increase from the previous year, with total revenues rising by 52.2% to $140 million and funded volume increasing to $8.3 billion from $2.9 billion [4] Group 3: Financial Position - As of March 31, 2025, total assets were $18.4 billion, down from $18.9 billion at the end of Q4 2024, while cash and cash equivalents increased to $784 million [5] - Total liabilities decreased to $13.6 billion from $14.1 billion, and total shareholders' equity rose to $4.9 billion from $4.8 billion [6] Group 4: Overall Assessment - The company ended Q1 2025 on a strong note, with solid performances in both the Originations and Servicing segments, supported by a robust balance sheet [7]

Mr. Cooper Group (COOP -1.03%) released its first-quarter earnings report before market open Wednesday, and this set the tone for its stock throughout the session. Since the company missed dramatically on both the top and bottom lines the shares ended up closing down by more than 1% in value. That compared most unfavorably to the almost 2% increase of the benchmark S&P 500 index. A pair of wide misses In Mr. Cooper's inaugural quarter of the year, revenue totaled $560 million, quite some distance down from ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ________________________________________________________________________________________________________ FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to _______ Commission file number: 001-14667 Mr. Cooper ...

Mr Cooper (COOP) came out with quarterly earnings of $2.97 per share, beating the Zacks Consensus Estimate of $2.81 per share. This compares to earnings of $2.28 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 5.69%. A quarter ago, it was expected that this reinsurance company would post earnings of $2.58 per share when it actually produced earnings of $2.73, delivering a surprise of 5.81%.Over the last four quarters, the comp ...

Financial Data and Key Metrics Changes - The company reported a net income of $88 million, with pretax operating earnings of $255 million, offset by an $82 million negative MSR mark net of hedges [18] - ROTCE increased to 16.8%, up from 15.8% in the previous quarter, reflecting benefits from the Flagstar acquisition [6] - Liquidity rose to $3.9 billion from $3.4 billion in the previous quarter, indicating strong cash flow generation [22] Business Line Data and Key Metrics Changes - The servicing segment generated pretax income of $332 million, a 22% year-over-year increase, attributed to lower amortization and operating leverage [10] - Originations produced $53 million in EBT, slightly above guidance, with strong volumes in the correspondent channel [13] - The total portfolio decreased slightly to $1.5 trillion, with a subservicing portfolio growing organically by 2% quarter-over-quarter [12] Market Data and Key Metrics Changes - Cash-out refinances made up 46% of volume, up from 39% last quarter, indicating strong demand for home equity loans [14] - The company helped over 9,000 customers access equity in their homes during the quarter [14] - Delinquencies in the mortgage servicing rights (MSR) portfolio decreased to 1.1%, reflecting strong asset quality [21] Company Strategy and Development Direction - The pending combination with Rocket aims to create a fully integrated homeownership platform, enhancing customer experience through AI and technology [4] - The company is focused on operational excellence and has received multiple awards for its servicing platform, which supports long-term growth [9] - The integration with Rocket is expected to leverage both companies' strengths, creating a comprehensive homeownership ecosystem [16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the integration with Rocket and the potential for enhanced customer offerings [16] - The current environment presents limited opportunities for rate and term refinances, but the company is prepared to act quickly when conditions improve [16] - The company does not expect to repurchase stock prior to the closing of the Rocket transaction, which is anticipated in Q4 2025 [25] Other Important Information - The company incurred $26 million in transaction and transition charges related to the Flagstar integration [19] - The MSR was marked down due to falling interest rates, leading to a quarter-end valuation of 155 basis points of UPB [20] - The capital ratio improved to 25.5%, up from 24.4% in the previous quarter, supported by strong earnings [24] Q&A Session Summary - No questions were taken during the call due to the pending combination with Rocket, as stated by management [3]

Financial Performance - Reported net income of $88 million for Q1 2025, down from $204 million in Q4 2024, with a return on common equity (ROCE) of 7.3% and operating return on tangible common equity (ROTCE) of 16.8%[7] - Total revenues for Q1 2025 were $560 million, compared to $654 million in Q4 2024, with operational revenue of $707 million, up from $672 million[6][19] - Total expenses increased to $430 million in Q1 2025 from $367 million in Q4 2024[19] - Net income for the quarter was $204 million, with diluted earnings per share at $3.13[27] - Operating income was reported at $178 million, with an operating ROTCE of 15.8%[28] - The company reported a pretax income of $280 million, with an income tax expense of $76 million[27] - Basic earnings per share for the quarter was $3.20, reflecting strong performance compared to previous periods[27] - The company experienced a decrease in ROCE to 7.3% from 17.3% in the previous quarter[31] - Total expenses for the quarter were $367 million, indicating effective cost management strategies[27] Servicing Segment - Servicing segment generated pretax income of $214 million, with a servicing portfolio of $1,514 billion, reflecting a 33% year-over-year growth[5][7] - The carrying value of mortgage servicing rights (MSR) was $11,345 million, equivalent to 155 basis points of MSR UPB[5][7] - Average UPB for the servicing portfolio was $1,531 billion, compared to $1,407 billion in the previous quarter[8] - The 60+ day delinquency rate improved to 1.5% at the end of Q1 2025, down from 1.6% in Q4 2024[8] Originations Segment - Originations segment earned pretax income of $45 million, funding 32,296 loans totaling approximately $8.3 billion in UPB, a 10% decrease quarter-over-quarter[9][10] - The company achieved a refinance recapture percentage of 51% in Q1 2025, up from 35% in Q4 2024[12] Strategic Developments - The company announced a combination with Rocket Companies to create an integrated homeownership platform[4][7] - The average stockholders' equity (BV) for the quarter was $4,852 million, showing growth from $4,726 million[31] - Average tangible book value (TBV) increased to $4,641 million, up from $4,553 million in the previous quarter[31] Gains on Mortgage Loans - The company recorded a net gain on mortgage loans held for sale of $117 million, contributing positively to overall revenues[27]

Core Insights - Mr Cooper (COOP) is expected to report quarterly earnings of $2.81 per share, reflecting a year-over-year increase of 23.3% [1] - Anticipated revenues for the quarter are projected to be $612.37 million, which represents an 8.6% increase compared to the same quarter last year [1] Earnings Projections - Over the last 30 days, the consensus EPS estimate has been revised upward by 0.8%, indicating a collective reassessment by analysts [2] - Changes in earnings projections are crucial for predicting investor reactions to the stock [3] Revenue Estimates - Analysts predict 'Revenues- Servicing' will reach $449.12 million, showing a slight decline of 0.2% year-over-year [5] - 'Revenues- Corporate and Other' is forecasted to be $39.50 million, indicating a significant increase of 79.6% from the prior-year quarter [5] - 'Revenues- Originations' is expected to be $126.30 million, reflecting a year-over-year increase of 37.3% [5] Stock Performance - Mr Cooper's shares have increased by 8.9% over the past month, contrasting with a decline of 6.3% in the Zacks S&P 500 composite [5] - The company holds a Zacks Rank of 3 (Hold), suggesting it is expected to perform in line with the overall market in the near future [5]

Core Viewpoint - The acquisition of Mr. Cooper Group Inc. by Rocket Companies, Inc. is valued at $9.4 billion, creating a significant player in the U.S. mortgage industry with a combined servicing portfolio of $2.1 trillion and 9.5 million clients [1][2]. Deal Structure - COOP shareholders will receive 11 RKT shares for each share of Mr. Cooper [2]. - The transaction is expected to enhance loan volume and client relationships, leading to increased recurring revenue and reduced client acquisition costs [2]. Leadership Insights - Jay Bray, COOP Chairman and CEO, emphasized the creation of a strong mortgage company that offers a comprehensive homeownership experience supported by advanced technology and customer care [3]. - Varun Krishna, RKT CEO, highlighted the importance of servicing in homeownership and the role of data and AI in delivering timely products [4]. Strategic Expansion - The acquisition will significantly expand Rocket Companies' homeownership platform, reinforcing its position as a leading mortgage servicer and originator [5]. - The combined entity will add nearly 7 million new clients and 150 million annual customer interactions, enhancing data capabilities and operational efficiency [6]. Financial Projections - Rocket anticipates $100 million in additional pre-tax revenue from improved recapture rates and integration of services, along with $400 million in pre-tax cost savings [7]. - The acquisition is expected to be immediately accretive to RKT's adjusted earnings per share upon closing, with anticipated acquisition-related charges of $400-$500 million [8]. Market Context - The U.S. housing market has faced challenges, but easing mortgage rates may lead to a rebound in demand during the upcoming spring buying season [9]. - The acquisition is viewed as a potential game changer for the long-term prospects of both companies [10]. Stock Performance - Year-to-date, shares of COOP and Rocket Companies have increased by 24.6% and 7.2%, respectively [11].

Group 1 - Mr Cooper (COOP) shares increased by 14.5% to close at $119.60, following a notable trading volume, contrasting with a 7% loss over the past four weeks [1] - The surge in COOP shares is attributed to the announcement of an acquisition by Rocket Companies, Inc. (RKT) in an all-stock deal valued at $9.4 billion, creating a significant mortgage entity in the U.S. with $2.1 trillion in loans and 9.5 million clients [2] - Under the acquisition terms, COOP shareholders will receive 11 RKT shares for each COOP share, which is expected to enhance loan volume and client relationships, leading to increased recurring revenue and reduced client acquisition costs [3] Group 2 - Mr Cooper is projected to report quarterly earnings of $2.91 per share, reflecting a year-over-year increase of 27.6%, with revenues expected to reach $624.03 million, up 10.6% from the previous year [3] - The consensus EPS estimate for Mr Cooper has been revised 1.1% higher in the last 30 days, indicating a positive trend that typically correlates with stock price appreciation [5] - Mr Cooper is categorized under the Zacks Financial - Consumer Loans industry, where another company, Ezcorp (EZPW), has shown a 0.3% increase in its stock price, closing at $14.72, with a 6.7% return over the past month [5]