NEW YORK - Waterfall Asset Management, LLC, an alternative investment adviser, has announced its intent to expand its partnership with Onity Group Inc. (NYSE: ONIT), a mortgage servicer and originator. The collaboration involves Onity’s acquisition of reverse mortgage assets from Mortgage Assets Management, LLC, a subsidiary of Waterfall-managed investment funds.
The assets in question, which are currently subserviced by PHH Mortgage Corporation, a subsidiary of Onity, include Home Equity Conversion Mortgages (HECMs), related borrowings, and other reverse mortgage assets. This move is part of Waterfall's strategy to grow its reverse mortgage initiatives and capitalize on the complementary strengths of both organizations.
Leo Wong, Partner at Waterfall, commented on the development, expressing enthusiasm for the potential growth of Home Equity Conversion Mortgage activities.
Waterfall Asset Management specializes in asset-backed credit, whole loans, real assets, and related strategies. The firm, founded in 2005, manages approximately $12.6 billion in assets as of January 1, 2024. It also acts as the external manager to Ready Capital Corporation (NYSE: NYSE:RC), which operates in real estate finance and small business lending.
This partnership is seen as a strategic move for both Waterfall and Onity, potentially enhancing investment opportunities in the reverse mortgage sector. The transaction is based on a letter of intent, and further details on the transfer of assets are yet to be disclosed.
Onity Group Inc., previously known as Ocwen Financial (NYSE:ONIT) Corporation, has begun operations under its new brand name and started trading on the New York Stock Exchange. The company's rebranding is seen as a significant milestone, reflecting its evolution over the past five years and its commitment to delivering results for customers and stakeholders.
Onity Group's primary brands, PHH Mortgage Corporation and Liberty Reverse Mortgage, are scheduled to transition to the Onity Mortgage brand in the upcoming fall. The company, with a global presence in the United States, the U.S. Virgin Islands, India, and the Philippines, is using this rebranding initiative as part of its continued efforts to expand and diversify its business operations.
Moreover, Onity Group cautions that actual results could differ due to various factors, including market conditions and regulatory approvals. As it embarks on this new chapter, Onity Group aims to reinforce its position as a leading non-bank mortgage servicer and originator.
InvestingPro Insights
In light of the recent partnership expansion between Waterfall Asset Management, LLC and Onity Group Inc. (NYSE: ONIT), it is noteworthy to consider Onity's financial strength and market performance. According to InvestingPro data, Onity has demonstrated a solid financial footing with a P/E Ratio (Adjusted) of 12.05, reflecting a company that may be undervalued relative to its earnings. Additionally, the company's Gross Profit Margin stands at 18.72% for the last twelve months as of Q2 2024, underscoring its efficiency in generating revenue relative to the cost of goods sold.
InvestingPro Tips for Onity reveal a company with a commitment to returning value to shareholders. Onity has raised its dividend for 3 consecutive years, signifying a reliable income stream for investors. Moreover, the firm has maintained dividend payments for an impressive 33 consecutive years, highlighting its long-term stability and commitment to shareholders. These aspects are particularly relevant for investors seeking steady dividend income and long-term investment security.
Onity's stock performance further complements these financial metrics, with a 1 Year Price Total Return of 22.86%, illustrating the stock's appreciable gain over the past year. Investors interested in exploring more about Onity's financial health and investment potential can find an additional 12 InvestingPro Tips on https://www.investing.com/pro/OCN, offering deeper insights into the company's valuation, liquidity, and profitability.
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