PennyMac Financial Services, Inc. Stock 12‑Month Price Target Cut to $78.67, Implies 22% Upside

PennyMac Financial Services (PFSI) reported Q3 2026 earnings with a $7M production loss, but servicing income rose to $132M. The company plans $160M in expense cuts and sold $29B in MSRs for $490M. CEO Spector expects Q4 ROE near 5% and low double-digit ROE in 2027. Net income was $29M, or $0.54 per share, with a 3% annualized ROE.

PennyMac Financial Services (PFSI) reported Q3 earnings, with consumer-direct fundings at $3.3B, including $700M in closed-end second liens. Servicing income rose to $99M, and the MSR asset value increased by $930M. The company plans $160M in annualized cost cuts and expects to close the Cenlar acquisition in Q1 2027. It also agreed to sell $29B in low-coupon MSRs, expecting $490M in net proceeds.

PennyMac (PFSI) reported Q3 2026 adjusted net income of $56M ($1.05 per share), a 5% ROE. Production segment losses were driven by lower revenues, slower expense declines, and high loan pipelines from prior quarters. Servicing segment pretax income was $99M, up from Q2. Higher mortgage rates reduced origination demand, but lower prepayment speeds boosted servicing profitability.

PennyMac Financial Services (PFSI) reported Q3 2026 revenue of $469M, down 25.6% YoY and below estimates. Adjusted EPS of $1.05 missed expectations by 14.9%. CEO David Spector cited industry-wide mortgage origination challenges and expects to reduce expenses by $160M by Q1 2027. TBVPS grew 6% YoY to $83.85, but missed estimates.

PennyMac Financial (PFSI) reported Q3 EPS of $1.05, missing estimates by $0.21, but revenue of $548M exceeded expectations. The stock is down 14.59% over 3 months and 48.60% over 12 months. InvestingPro rates its financial health as 'fair performance'.

PennyMac Financial Services, Inc. (PFSI) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 PennyMac Financial Services, Inc. Reports Third Quarter 2026 Results and Announces Changes to its Leadership Team WESTLAKE VILLAGE, Calif. – October 29, 2026 – PennyMac Financial Services, Inc. (NYSE: PFSI) today reported net income of $29 million, or $0.54 in dilute