Latest Ratios: P/E Ratio -5.6x · EV/EBITDA 21.0x · ROE -6.5%. (1996–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $442M | $720M | $863M | $862M | $792M | $1.9B | $1.0B | $2.3B | $1.7B | $1.5B | $1.5B |
| Enterprise Value | $22.3B | $22.6B | $17.0B | $13.4B | $12.0B | $14.3B | $9.4B | $17.9B | $11.9B | $7.0B | $5.5B |
| P/E Ratio → | -5.60 | — | 20.41 | — | — | 5.57 | — | 11.33 | 13.83 | 9.26 | 9.88 |
| P/S Ratio | 0.40 | 0.65 | 0.80 | 5.43 | 1.52 | 1.97 | — | 6.91 | 7.67 | 6.32 | 5.74 |
| P/B Ratio | 0.47 | 0.73 | 0.73 | 0.72 | 0.73 | 1.35 | 0.90 | 0.13 | 0.14 | 0.22 | 0.29 |
| P/FCF | — | — | — | — | — | — | — | 23.76 | — | — | — |
| P/OCF | — | — | — | — | — | — | — | — | — | — | — |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 20.44 | 15.70 | 84.57 | 23.04 | 15.02 | — | 54.60 | 54.88 | 29.46 | 21.05 |
| EV / EBITDA | 20.98 | 21.24 | 18.35 | 354.37 | 30.18 | 17.86 | — | 57.88 | 88.08 | 43.16 | 29.43 |
| EV / EBIT | 21.18 | 21.44 | 18.58 | — | 32.63 | 18.70 | — | — | 32.08 | 26.90 | 23.32 |
| EV / FCF | — | — | — | — | — | — | — | 187.61 | — | — | — |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 95.6% | 95.6% | 96.9% | 86.3% | 96.2% | 97.7% | 104.0% | 97.0% | 96.5% | 100.0% | 94.3% |
| Operating Margin | 95.3% | 95.3% | 84.5% | 6.7% | 70.6% | 80.7% | 138.2% | 64.6% | 61.7% | 67.7% | 71.1% |
| Net Profit Margin | -6.3% | -6.3% | 5.0% | -1.4% | -31.3% | 33.6% | 183.0% | 51.7% | 55.3% | 58.7% | 50.6% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | -6.5% | -6.5% | 4.5% | -0.2% | -13.2% | 25.6% | -6.3% | 1.2% | 1.3% | 2.4% | 4.2% |
| ROA | -0.3% | -0.3% | 0.3% | -0.0% | -1.2% | 2.6% | -4.1% | 1.1% | 1.3% | 2.2% | 2.2% |
| ROIC | 3.9% | 3.9% | 4.4% | 0.1% | 2.1% | 4.9% | -1.6% | 0.6% | 0.6% | 1.1% | 1.8% |
| ROCE | 6.1% | 6.1% | 5.6% | 0.1% | 2.7% | 6.1% | -3.5% | 1.7% | 1.9% | 3.4% | 4.2% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 22.56 | 22.56 | 13.80 | 10.68 | 10.61 | 9.29 | 7.97 | 0.91 | 0.90 | 0.84 | 0.82 |
| Debt / EBITDA | 20.80 | 20.80 | 17.68 | 339.35 | 28.84 | 16.08 | — | 51.19 | 77.07 | 34.79 | 22.56 |
| Net Debt / Equity | — | 22.30 | 13.60 | 10.44 | 10.37 | 8.97 | 7.55 | 0.90 | 0.89 | 0.82 | 0.78 |
| Net Debt / EBITDA | 20.56 | 20.56 | 17.42 | 331.60 | 28.20 | 15.52 | — | 50.55 | 75.77 | 33.90 | 21.41 |
| Debt / FCF | — | — | — | — | — | — | — | 163.84 | — | — | — |
| Interest Coverage | 0.96 | 0.96 | 1.09 | -0.01 | 0.67 | 1.79 | -0.04 | -0.02 | 1.55 | 2.40 | 2.65 |
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 0.28 | 0.28 | — | — | — | — | 0.88 | 0.31 | 0.07 | 0.07 | 0.23 |
| Quick Ratio | 0.28 | 0.28 | — | — | — | — | 1.05 | 0.31 | 0.07 | 0.07 | 0.22 |
| Cash Ratio | 0.19 | 0.19 | — | — | — | — | 1.30 | 0.18 | 0.07 | 0.07 | 0.23 |
| Asset Turnover | — | 0.05 | 0.06 | 0.01 | 0.04 | 0.06 | -0.03 | 0.02 | 0.02 | 0.03 | 0.05 |
| Inventory Turnover | — | — | — | — | — | — | — | — | 1.90 | — | 2.68 |
| Days Sales Outstanding | — | — | — | — | — | — | — | — | — | — | — |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | 21.5% | 13.7% | 10.8% | 10.9% | 14.1% | 4.9% | 8.4% | 5.7% | 5.8% | 5.8% | 5.9% |
| Payout Ratio | — | — | 172.0% | — | — | 28.7% | — | 76.5% | 80.9% | 62.9% | 67.4% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | — | — | 4.9% | — | — | 18.0% | — | 8.8% | 7.2% | 10.8% | 10.1% |
| FCF Yield | — | — | — | — | — | — | — | 4.2% | — | — | — |
| Buyback Yield | 11.7% | 7.2% | 0.0% | 0.6% | 7.4% | 0.0% | 2.2% | 0.0% | 1.0% | 0.6% | 1.9% |
| Total Shareholder Yield | 33.3% | 20.9% | 10.8% | 11.5% | 21.5% | 4.9% | 10.6% | 5.7% | 6.8% | 6.4% | 7.8% |
| Shares Outstanding | — | $130M | $132M | $116M | $117M | $142M | $114M | $137M | $110M | $102M | $98M |
Includes 30+ ratios · 30 years · Updated daily
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Quick answers to the most common questions about buying RWT stock.
Redwood Trust, Inc.'s current P/E ratio is -5.6x. The historical average is 13.0x.
Redwood Trust, Inc.'s current EV/EBITDA is 21.0x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 34.1x.
Redwood Trust, Inc.'s return on equity (ROE) is -6.5%. The historical average is 2.6%.
Based on historical data, Redwood Trust, Inc. is trading at a P/E of -5.6x. Compare with industry peers and growth rates for a complete picture.
Redwood Trust, Inc.'s current dividend yield is 21.53%.
Redwood Trust, Inc. has 95.6% gross margin and 95.3% operating margin. Operating margin above 20% indicates strong pricing power and cost efficiency.
Redwood Trust, Inc.'s Debt/EBITDA ratio is 20.8x, indicating high leverage. A ratio above 4x may signal elevated financial risk.
Key Metrics
Top Statement Risk
Extreme leverage and volatile earnings
Metrics are mathematically derived from official filings.
Valuation Discount Amidst Leverage and Volatility
Redwood Trust trades at a P/B of 0.61, a significant discount to book value, which appears to reflect the market's concern over its extreme leverage and volatile earnings profile, as reported in recent financial statements.
The P/B discount suggests the market is pricing in substantial risk to the tangible equity base, which has contracted 22% over the last ten quarters. The lack of a meaningful P/FFO or P/AFFO multiple, given the erratic FFO history, makes traditional valuation multiples unreliable. The implied cap rate, calculated as NOI divided by enterprise value, is not a meaningful metric for this mortgage REIT, as its income is not derived from property ownership but from interest spreads and mortgage banking activities.
NOI Margin Volatility Masks Core Earnings
NOI margins have swung from -24.3% in 2025Q2 to 95.6% in 2025Q4, indicating that quarterly profitability is driven by non-recurring gains from mortgage loan sales rather than stable net interest income, as shown in the ratio data.
The extreme margin volatility suggests that FFO growth is not organically driven but is instead dependent on the timing and magnitude of gains from securitizations and loan sales. This pattern makes it difficult to assess the sustainability of core earnings. The negative FFO per share in four of the last ten quarters further underscores the instability of the company's profit generation.
Dividend Yield Appears Unsustainable
The 16.4% dividend yield is not supported by recent FFO, with the FFO payout ratio exceeding 100% in multiple quarters and FFO per share being negative in others, suggesting the dividend may be funded from external sources.
The absence of AFFO data prevents a precise assessment of cash available for distribution, but the persistent negative operating cash flow noted in prior analysis is a critical red flag. The high yield likely reflects market skepticism about the dividend's sustainability rather than a genuine income opportunity. Investors should monitor whether the company can generate consistent positive FFO to cover distributions.
Leverage Expansion Outpaces Equity
Redwood Trust's debt-to-equity ratio has ballooned to 29.41x as of 2026Q2, with total debt of $27.5B against equity of just $934M, indicating a highly leveraged and potentially vulnerable capital structure.
This extreme leverage, which has nearly tripled from 10.93x in 2024Q1, significantly increases the company's sensitivity to interest rate movements and refinancing risk. The minimal cash reserves of $672.7M represent only 2.3% of total debt, suggesting a heavy reliance on continuous access to short-term funding markets. The interest coverage ratio of 58.87 in 2026Q2 appears strong but is likely distorted by the same non-cash items affecting FFO, warranting further investigation into the quality of earnings used to service this debt.
Asset-Light Model Concentrates Risk
With PPE net of only $21.4M representing less than 0.1% of total assets, Redwood Trust's portfolio is entirely composed of financial assets, concentrating risk in mortgage credit and interest rate exposure.
The lack of physical property assets means traditional REIT metrics like occupancy rate are irrelevant. Instead, the key quality metrics are the credit performance of the mortgage portfolio and the stability of net interest margins. The volatile FFO and negative operating cash flow suggest the portfolio may be experiencing mark-to-market losses or funding pressures, which could impair asset values if market conditions deteriorate.
The Misleading P/E Ratio
The reported P/E of -7.33 is deeply misleading for Redwood Trust, as GAAP net income is dominated by non-cash mark-to-market adjustments on its mortgage portfolio, rendering the metric useless for valuation.
For mortgage REITs like Redwood, the standard P/E ratio is distorted by unrealized gains and losses on financial assets, which flow through the income statement but do not represent cash earnings. The appropriate metric is P/FFO or P/AFFO, but even these are unreliable given the company's erratic FFO history. Analysts should instead focus on tangible book value and the spread between portfolio yields and funding costs to assess underlying economic value.