PennyMac Mortgage (8PM) Q3 2026 Earnings Report
DE:8PM Q3 2026 EPS Results
- Actual EPS
- -EUR 0.37
- Consensus EPS
- EUR 0.27
- Beat/Miss
- Missed by -EUR 0.64
- One Year Ago EPS
- EUR 0.49
DE:8PM Q3 2026 Revenue Results
- Actual Revenue
- EUR 196.43M
- Expected Revenue
- EUR 84.83M
- Beat/Miss
- Beat by +EUR 111.60M
- YoY Revenue Growth
- -55.06%
Earnings Announcement Details
- Quarter
- Q3 2026
- Date
- 10/29/2026
- Time
- After Close
- Conference Call
- Thursday, October 29, 2026
DE:8PM Upcoming Earnings
PennyMac Mortgage's next earnings date is estimated for February 4, 2027, based on past reporting schedules.
Q3 2026 Earnings Call Audio
DE:8PM Q3 2026 Earnings Call
0:00 / 0:00
Q3 2026 Earnings Slide Deck
Q3 2026 Earnings Call Summary
Earnings Call Sentiment|Positive
The call was fundamentally constructive, with improved adjusted earnings, a 15% increase in projected run rate return potential, substantial MSR monetization, active capital rotation into higher-return credit investments, strong securitization demand and lower risk sensitivity than peers. These positives were offset by a $36 million net loss, a 5% decline in book value per share, significant market-driven valuation losses, lower aggregation income, higher leverage and an expected reduction in the common dividend.
Company Guidance
PMT said its upcoming fourth quarter common dividend is expected to be reduced, with a rate of about $0.30 a share requiring Board approval, which would allow $0.08 per quarter of growth in book value per share; projected run rate return potential over the next 4 quarters is $0.38 per common share, translating to an expected average annualized return on common equity of 10.6%, while the MSR asset is projected to deliver an annualized return on equity of 12.8% and organically created investments carry targeted ROEs in the low to mid-teens; PMT expects to complete approximately 30 securitizations in 2026 and expects it will have added more than $600 million of retained investments through 2026.
- Adjusted Earnings Improved Despite Market VolatilityExcluding market-driven value changes, PMT generated adjusted net income attributable to common shareholders of $30 million, or $0.35 per common share, representing a 9% annualized adjusted return on equity. Adjusted earnings increased from $0.25 per share and a 6% adjusted ROE in the prior quarter, primarily due to a higher contribution from interest rate-sensitive strategies.
- Share Repurchase Authorization IncreasedPMT's Board of Trustees approved a $130 million increase to its share repurchase authorization, bringing total available capacity to over $200 million. Management said it is evaluating repurchases when they meet return hurdles, while also considering alternative residential mortgage investments and leverage.
- Lower Interest Rate and Spread Sensitivity Than PeersEntering the quarter, PMT's modeled book value sensitivity to an instantaneous 50 basis point parallel rate shock was 0.7%, compared with a 3.6% average for publicly traded mortgage REIT peers. Under a 10 basis point spread-widening shock, PMT's modeled book value loss was 1.3%, compared with 4.4% for the peer group, reflecting diversification across MSRs, Agency MBS and credit assets.
- Significant MSR Sales and Capital RotationPMT sold $13 billion in UPB of Agency MSRs during the third quarter, agreed to sell an additional $10 billion during the quarter and entered into an agreement after quarter end to sell another $12 billion. Total closed and committed MSR sales reached approximately $35 billion, with transactions executed at prices at or near fair value. Management plans to redeploy capital toward higher-return organically created credit investments and other investments, including potential share repurchases.
- Private Label Securitization Activity ExpandedPMT completed 8 private label securitizations during the third quarter across nonowner-occupied, jumbo and owner-occupied collateral, totaling $2.9 billion in UPB and producing $167 million of retained investments with expected ROEs in the mid-teens. After quarter end, PMT completed 2 additional securitizations and priced its inaugural non-QM DSCR securitization totaling $1.1 billion in UPB, with $119 million of expected retained investments.
- Forward Run Rate Return Potential Increased 15%Projected run rate return potential for the next 4 quarters increased to $0.38 per common share from $0.33 in the prior quarter, a 15% increase, implying an expected average annualized return on common equity of 10.6%. Management attributed the improvement to higher interest rates, lower prepayment expectations, recent MSR sales and redeployment into organically created investments targeted to generate ROEs in the low to mid-teens.
- Strong Organic Investment Creation PipelinePMT generated $17 million of new MSR investments during the quarter and said it remains on pace to complete approximately 30 securitizations in 2026. Through 2026, the company expects to add more than $600 million of retained investments with returns on equity in the low to mid-teens.
- High-Quality Retained Investment PortfolioThe fair value of retained investments from PMT's private label securitization program exceeded $1 billion at quarter end. The portfolio comprised 58% nonowner-occupied loan securitizations, 20% jumbo loan securitizations and the remainder owner-occupied loan securitizations, with a weighted average FICO at origination of 775, weighted average LTV at origination of 73% and negligible delinquencies.
- Interest Rate-Sensitive Strategies Generated Higher IncomeInterest rate-sensitive strategies generated $36 million of pretax income, with income excluding market-driven value changes of $37 million, up from $20 million in the prior quarter. Lower prepayment speeds during the quarter drove slower runoff of MSR assets. PMT also purchased $548 million of Agency floating-rate MBS, increasing the fair value of its MBS portfolio to $4.3 billion from $4.1 billion.
- Hedging Effectively Mitigated Interest Rate ExposureDuring the quarter, the $226 million increase in MSR fair value was offset by $240 million of net declines in the fair value of MBS and interest rate hedges, including related tax benefits. Management stated that its hedging activities effectively mitigated PMT's interest rate risk exposure.
- Diversified Platform and Servicing CapabilitiesPMT said its Agency MBS and credit-sensitive investments provide a natural hedge to its MSR portfolio, while residual exposure is actively managed with interest rate derivatives. Correspondent acquisitions are now limited to non-Agency loans, and the relationship with PennyMac Financial Services provides access to organically created residential mortgage investments and a servicing platform focused on proactive delinquency management and loss mitigation.
- Strong Securitization Demand and MSR Market DepthManagement said demand for private label securitizations remains strong and that PMT had already priced 2 deals in the current quarter. It also stated that the bulk MSR market has sufficient buyer depth to support continued opportunistic sales, with the low note-rate MSR segment described as particularly well bid.
- Flexible Financing ProfilePMT reported having only $50 million of unsecured financing maturities prior to 2029. Management said the source of repayment for nonrecourse debt associated with private label securitizations is limited to cash flows from the related loans.
- Leadership Succession PlanDoug Jones, President and Chief Mortgage Banking Officer, plans to retire on June 30, 2027. Effective January 1, 2027, Chief Strategy Officer Kevin Ryan will become CFO, while current CFO Dan Perotti will remain through year-end and support the company in an advisory role through the first quarter of 2027. Management said PMT has an exceptional leadership team and a deep bench prepared to provide continuity.
DE:8PM Earnings History
| Report Date | Fiscal Quarter | Forecast / EPS | Last Year's EPS | EPS YoY Change | Press Release |
|---|---|---|---|---|---|
| Feb 04, 2027 | 2026 (Q4) | 0.28- | 0.43 | ― | ― |
| Oct 29, 2026 | 2026 (Q3) | 0.27-0.37 | 0.49 | -174.55% (-0.86) | |
| Jul 29, 2026 | 2026 (Q2) | 0.270.21 | -0.04 | 675.00% (+0.24) | |
| May 05, 2026 | 2026 (Q1) | 0.330.14 | -0.01 | 1700.00% (+0.15) | |
| Jan 29, 2026 | 2025 (Q4) | 0.350.43 | 0.37 | 17.07% (+0.06) | |
| Oct 21, 2025 | 2025 (Q3) | 0.320.49 | 0.32 | 52.78% (+0.17) | |
| Jul 22, 2025 | 2025 (Q2) | 0.32-0.04 | 0.15 | -123.53% (-0.19) | |
| Apr 22, 2025 | 2025 (Q1) | 0.34-0.01 | 0.35 | -102.56% (-0.36) | |
| Jan 30, 2025 | 2024 (Q4) | 0.320.37 | 0.39 | -6.82% (-0.03) | |
| Oct 22, 2024 | 2024 (Q3) | 0.310.32 | 0.46 | -29.41% (-0.13) |
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
Beat Missed
