Redwood Trust (RWT) Stock: Buy, Sell, or Hold?
RWT - Redwood Trust, Inc.
$3.12
0.11 (3.65%)
▲
5d:
+0.32%
30d:
-16.13%
90d:
-36.59%
BUY
HIGH Confidence
Analysis Updated: Oct 22, 2026 12:00 AM ET
Earnings: Nov 03, 2026
10d
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Interactive Price Chart (1 Month)
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Bottom Line:
✅ BUY SIGNAL: RWT trading at deep discount. Market pricing in -16.6% annual earnings decline, creating value opportunity for patient investors.
✅ BUY SIGNAL: RWT trading at deep discount. Market pricing in -16.6% annual earnings decline, creating value opportunity for patient investors.
Long-Term Wealth Forecast (2031)
Based on Analyst Consensus Growth & Historical Valuation
0% (Stagnation)
50% (Hyper Growth)
EST. PRICE IN 2031
$6.21
Based on 3.0% avg growth
INTRINSIC VALUE TODAY
$3.86
19.1% Margin of Safety
How this is calculated: We use a Growth Decay Model: starting with analyst consensus growth (adjusted above) and gradually slowing it down to a long-term terminal rate (4%) by Year 5. This provides a more realistic valuation than assuming constant hyper-growth. We then apply a 5.3x Exit PE.
In-depth Analysis How we analyze
Valuation Analysis: RWT is currently trading at $3.12, which is considered slightly low relative to its 30-day fair value range of $3.12 to $3.87. From a valuation perspective, the stock is trading at a discount (Forward PE: 3.1) compared to its historical average (5.3). Remarkably, the market is currently pricing in an annual earnings decline of 16.6% over the next few years. This aligns with recent fundamental challenges.
Technical Outlook: Technically, RWT is in a strong downtrend. Immediate support is located at $2.88, while resistance sits at $3.41. The stock is showing strong short-term momentum, up 3.7% recently.
Market Sentiment: RWT scores 75/100 on our bottoming-setup gauge — the chart has corrected and is stabilizing (RSI reset, momentum turning up), historically a favorable entry zone. Wall Street analysts see significant upside, with an average price target of $5.09 (+63.1%). Combining these factors, the current setup offers a favorable risk/reward ratio for buyers.
Technical Outlook: Technically, RWT is in a strong downtrend. Immediate support is located at $2.88, while resistance sits at $3.41. The stock is showing strong short-term momentum, up 3.7% recently.
Market Sentiment: RWT scores 75/100 on our bottoming-setup gauge — the chart has corrected and is stabilizing (RSI reset, momentum turning up), historically a favorable entry zone. Wall Street analysts see significant upside, with an average price target of $5.09 (+63.1%). Combining these factors, the current setup offers a favorable risk/reward ratio for buyers.
Quick Decision Summary
Current Position
SLIGHTLY LOW
Historical Trading Range
$3.12 -
$3.87
Company Quality Score
54/100
(HOLD)
Volume Confirmation
HIGH
Confidence Score
95.2%
All Signals
- BULLISH: Price oversold vs 30-day range
- BULLISH: Strong technical setup (75/100)
- BULLISH: High volume confirmation
- BULLISH: Strong upward momentum (+3.7%)
- BULLISH: Trading 63.1% below Wall St target ($5.09)
- BULLISH: Bottoming setup score 75/100 — corrected, stabilizing, and turning up
Trading Range Analysis
30-Day Trading Range
$3.12 -
$3.87
Current vs Trading Range
SLIGHTLY LOW
Support & Resistance Levels
Support Level
$2.88
Resistance Level
$3.41
Current Trend
Strong Downtrend
Technical data as of
Oct 22, 2026
Fundamental Context
Forward P/E (Next Year Est.)
3.08
Wall Street Target
$5.09
(+63.1%)
Revenue Growth (YoY)
-13.4%
Earnings Growth (YoY)
-52.6%
Profit Margin
2.2%
Valuation Discount vs History
-16.6% cheaper
PE vs Historical
3.1 vs 5.3
CHEAP
Market-Implied Price Targets
If current PE multiple persists
Implied Growth (YoY):
-16.6%
(market-implied from PE analysis)
1-Year Target
$2.81
(-10%)
2-Year Target
$2.53
(-19%)
3-Year Target
$2.27
(-27%)
3-Yr Target (if PE normalizes)
(PE: 3→5)
$3.91
(+25%)
3-Year Scenarios
Using analyst projected EPS growth
Bull:
(PE: 19.9, Growth: 2.0%)
$21.33
(+584%)
Base:
(SPY PE: 3.1, Growth: 2.0%)
$3.31
(+6%)
Bear:
(PE: 2.6, Growth: 2.0%)
$2.82
(-10%)
💡
Upside Surprise Potential
If earnings stabilize (0% growth), PE could expand from 3.1 to 5.3
Stabilization Target:
$5.36
(+71.8%)
PE Expansion Potential:
+71.8%
Share & Embed Analysis
Last updated: October 23, 2026 6:49 AM ET
Data refreshes hourly during market hours. Next update: 7:49 AM
Data refreshes hourly during market hours. Next update: 7:49 AM
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Technical Signals Check
Is RWT showing a specific setup today?
Insider Activity (6 Months)
0
Buys
0
Sells
0
Net
NEUTRAL
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Professional options setups generated by AI based on today's RWT price and gamma walls.
