Velocity Financial, Inc. Stock Price, News & Analysis

Velocity Financial, Inc. (NYSE: VEL) has voluntarily converted all 45,000 shares of Series A Convertible Preferred Stock into 11,688,310 shares of common stock. This conversion moves the $90 million liquidation preference value from mezzanine equity to permanent stockholders’ equity. As of June 30, 2021, stockholders’ equity would have increased from $233 million to $323 million had the conversion occurred. CFO Mark Szczepaniak stated that this successful conversion removes uncertainties regarding liquidation preferences and enhances the company's capital structure.

Velocity Financial, Inc. (NYSE: VEL) announced its second securitization of 2021, closing a $205 million issuance of Mortgage-Backed Certificates (series 2021-2), backed by a portfolio of recently originated loans. The certificates, rated by KBRA and DBRS Morningstar, feature a weighted average fixed rate of 1.75%. Velocity's strong market reception for this transaction led to tighter spreads by over 9 basis points compared to its earlier securitization. The company will retain at least 5% of this transaction, reflecting confidence in its loan quality.

Velocity Financial, Inc. (NYSE: VEL) reported a strong financial performance for 2Q21, posting a net income of $9.45 million, a significant increase from $3.40 million in 1Q21. Core income rose to $8.45 million, up from $6.72 million. The diluted earnings per share reached $0.28, compared to $0.10 in the previous quarter. The company’s total loan portfolio grew to $2.07 billion, a 4% increase over the prior quarter. The net interest margin improved to 4.83%. However, the loan loss reserve decreased to $3.96 million, reflecting an optimistic economic outlook.

Velocity Financial, Inc. (NYSE:VEL) is set to announce its Q2 2021 financial results on August 5, 2021, after market close. A conference call will follow at 2:00 p.m. PT, where executive management will discuss these results. Investors can access the call via a live webcast on the company's Investor Relations website. A replay will also be available until August 30, 2021. Based in Westlake Village, California, Velocity specializes in small balance investor loans secured by residential rental and small commercial properties, leveraging a nationwide network of independent mortgage brokers.

Velocity Financial, Inc. (NYSE: VEL) has successfully closed its first securitization transaction of 2021, totaling $265 million in Mortgage-Backed Certificates, series 2021-1. The certificates, backed by recently originated loans, feature a weighted average fixed rate of 1.735%. They have received ratings from KBRA and DBRS Morningstar, with the largest class (A) rated AAA. Executive Vice President Jeff Taylor expressed confidence in the strong market demand, which helped reduce funding costs and improve growth prospects. The certificates are not registered under the Securities Act of 1933.

Velocity Financial, Inc. (NYSE: VEL) announced an upgrade and affirmation of ratings on its 12 securitizations by Kroll Bond Rating Agency (KBRA) following a comprehensive review. KBRA's analysis included current loss expectations and noted low cumulative loss levels between 0.05% and 0.43%, with 7 of the 12 securitizations experiencing no losses since inception. The review considered VCC’s strong collateral performance and resilience against pandemic impacts. Executive Vice President Jeff Taylor emphasized the disciplined underwriting as a key driver behind the favorable ratings.

Velocity Financial, Inc. (NYSE: VEL) reported a net income of $3.40 million for 1Q21, up 32% from $2.58 million in 1Q20. Core income also rose to $6.72 million, despite diluted EPS decreasing to $0.10 from $0.13. The book value per share fell to $11.12 from $12.47 year-over-year. The company noted a 30% growth in production volumes quarter-over-quarter and is optimistic about the economic recovery. However, total loan portfolio decreased by 6% year-over-year to $1.99 billion, driven by nonperforming loans increasing by 122% due to pandemic impacts.

Velocity Financial, Inc. (NYSE:VEL) will release its first quarter 2021 financial results after the market closes on May 6, 2021. The executive management team will host a live conference call at 2:00 PM PT / 5:00 PM ET to discuss the results. The call will be available via webcast on the company's Investor Relations website, with a slide presentation accessible after market close. Investors can participate by phone, with a replay available until May 27, 2021.

Velocity Financial reported a net income of $9.6 million for Q4 2020, a significant increase from $3.5 million in Q3 2020. The diluted earnings per share rose to $0.29, while book value per common share increased to $10.93. The company's total loan portfolio decreased by 2% to $1.93 billion. Despite a rise in nonperforming loans to 17.23%, operating expenses decreased by 9% quarter-over-quarter. Velocity's total net revenues grew by 33%, reflecting strong loan sales and improved interest income. The firm anticipates further growth in originations as it moves into 2021.