Industry Overview - The Zacks Mortgage & Related Services industry is experiencing growth due to declining mortgage rates, influenced by the Federal Reserve's interest rate cuts in 2025 and expectations for further easing this year [1][4] - The industry consists of providers of mortgage-related loans, refinancing, and loan-servicing facilities, with non-banks gaining market share as banks retreat from the mortgage business due to higher compliance and capital requirements [3] Current Trends - The 30-year fixed mortgage rate has stabilized around a low-6% range since mid-September 2025, providing relief for homebuyers and improving purchase demand [4][5] - Refinancing activity is recovering as homeowners seek to refinance into lower-rate loans, which is expected to drive higher loan origination volumes and improve fee income for industry players [6] - The competitive landscape is intensifying, with mortgage servicers facing pressure to cut prices, leading to reduced sales margins [2][7] Performance Metrics - The Zacks Mortgage & Related Services industry has outperformed the broader Zacks Finance sector and the S&P 500, gaining 54.7% over the past year compared to 23.2% and 23.4% for the sector and S&P 500, respectively [11] - The industry currently trades at a price-to-book (P/B) ratio of 6.27X, lower than the S&P 500's 8.67X, indicating a premium compared to the broader finance sector's P/B of 4.36X [14][17] Company Highlights - **PennyMac Financial Services, Inc. (PFSI)**: A specialty financial services firm benefiting from a strong servicing business and a strategic transaction with Annaly Capital Management. The Zacks Consensus Estimate for PFSI's 2025 earnings is $11.71 per share, a 1.7% increase from the previous year [20][21] - **Federal Agricultural Mortgage (AGM)**: Known as Farmer Mac, it focuses on creating a secondary market for loans to rural borrowers. AGM's 2025 earnings estimate is $17.53 per share, reflecting a 12.1% rise from the prior year [24][25] - **LendingTree, Inc. (TREE)**: An online marketplace enhancing its product offerings and focusing on improving purchase conversion rates. The Zacks Consensus Estimate for TREE's 2025 earnings is $4.79 per share, indicating a 50.2% increase from the previous year [27][30]